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Crude oil futures rose for a third straight session Thursday, supported by continuing tensions in the Middle East as Israel braces for an expected attack from Iran and this week’s report of a sixth consecutive drawdown in U.S. crude inventories.
A halt to crude production from Libya’s biggest oil field has helped support gains, and a surprise cross-border attack by Ukrainian troops into Russia added to geopolitical risk.
“A recovery in the stock market is also easing some recessionary demand fears,” and Middle East retaliation expectations have raised geopolitical fears of tighter supplies, BOK Financial’s Dennis Kissler said, according to Bloomberg.
The stock market took off Thursday after data showed the number of U.S. jobless claims fell more than expected last week, suggesting fears of a deteriorating labor market were overblown.
“The latest U.S. data on jobless claims indicates still a growing U.S. economy, reducing some of the oil demand concerns,” UBS analyst Giovanni Staunovo said, as reported by Reuters.
The top futures benchmarks scored their third straight gains, as front-month Nymex crude (CL1:COM) for September delivery settled +1.3% to $76.19/bbl and front-month October Brent crude finished +1% to $79.16/bbl.
Front-month Nymex natural gas (NG1:COM) for September delivery ended +0.7% to $2.127/MMBtu, also rising for a third consecutive day.
ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (USOI), (UNG), (BOIL), (KOLD), (UNL), (FCG)
“The oil market’s ability to hold firm in posting little change from last Friday attests to improving U.S. crude balances where stocks have declined by about 31 million barrels during the past six weeks, a reduction that compares with the five-year average draw of about 13 million barrels,” Ritterbusch analysts said, according to Dow Jones.
