2024.02.0519:08:00UTC+00Oil Futures Settle Higher

Oil futures settled higher on Monday as concerns about potential trade and supply disruptions amid tensions in the Middle East and the ongoing Russia-Ukraine war outweighed a firm dollar.

The dollar gained in strength amid fading hopes of an early interest rate cut by the Federal Reserve following recent buoyant economic data, and Fed Chair Jerome Powell's comments that a rate cut is unlikely by March.

West Texas Intermediate Crude oil futures for March settled lower by $0.50 or about 0.7% a barrel at $72.78 a barrel.

Brent crude futures ended up $0.66 or 0.85% at $77.99 a barrel.

Geopolitical tensions persist after the U.S. and U.K. conducted strikes against Houthi targets over the weekend and the Iran-backed Houthis vowed to respond, saying the air strikes "will not deter us."

Fed Chair Jerome Powell reiterated during an interview on Sunday with "60 Minutes" that the central bank is unlikely to cut interest rates next month.

Powell suggested the strength of the U.S. economy even amidst elevated rates will allow the Fed to proceed carefully. "With the economy strong like that, we feel like we can approach the question of when to begin to reduce interest rates carefully," Powell said.

According to CME Group's FedWatch Tool, the chances of a March rate cut have fallen to 16.5% now.