Oil futures climbed for a fourth straight session on Thursday, with Brent crude settling back above the $80-a-barrel threshold after Israel rejected a Hamas offer for a cease-fire and the return of hostages held in Gaza.
West Texas Intermediate crude for March delivery
rose $2.36, or 3.2%, to settle at $76.22 a barrel on the New York Mercantile Exchange. That was the highest front-month contract finish since Jan. 30, according to Dow Jones Market Data.
April Brent crude
the global benchmark, added $2.42, or 3.1%, at $81.63 a barrel on ICE Futures Europe, settling at its highest level since Jan. 31.
tacked on 3.5% to $2.34 a gallon, while March heating oil
added 2.7% to $2.89 a gallon.
Natural gas for March delivery
settled at $1.92 per million British thermal units, down 2.5%, marking another settlement at its lowest levels since September 2020.
Crude prices have continued to trade higher each day this week, with geopolitical tensions “a key source of support, particularly with recent escalations between the U.S. and Iran,” said Robbie Fraser, manager of global research and analytics at Schneider Electric, in a daily note.
Oil futures had been seeing temporary pops higher on developments in the Middle East since the start of the Israel-Hamas war in October, but overall have failed to build a lasting risk premium. Both Brent and WTI are trading well below 2023 highs set in late September.
Crude has found support this week after U.S.-led airstrikes on Iran-backed militias in Iraq and Syria following a drone attack last month that killed three U.S. service members in Jordan. The U.S.- and U.K.-led coalition also renewed strikes on Iran-backed Houthi rebels in Yemen who have targeted Red Sea shipping vessels and have forced the rerouting of cargo ships and some oil tankers.
Israeli Prime Minister Benjamin Netanyahu on Wednesday rejected Hamas’s terms for a cease-fire, which called for the release of thousands of prisoners.
The development added to concerns around the Middle East, helping crude maintain its recent upward trend, Ricardo Evangelista, senior traders at ActivTrades, said in emailed comments.
“While Gaza remains the focal point of the crisis, its repercussions extend throughout the region, raising the specter of a broader conflict with potential intervention from other parties. Such a scenario could disrupt the Suez shipping route and impact oil production in Gulf nations like Iran,” he said.
In the U.S. on Thursday, the Energy Department announced a “solicitation” — plans to buy about 3 million barrels of oil for delivery in July for the Strategic Petroleum Reserve, amid continued efforts to refill the reserve.
In recent weeks, the government agency has announced the new purchase of 3.1 million barrels of oil for the SPR for delivery in May and said it plans to buy up to another 3 million barrels of oil for the reserve for delivery in June.
Natural-gas prices, meanwhile, ended lower for a third consecutive session, logging another front-month contract settlement at its lowest level in more than three years. Analysts said some forecasts for milder weather eased demand expectations for the heating fuel.
Read: U.S. natural-gas consumption hit a record in January. So why are prices falling?
The U.S. Energy Information Administration reported on Thursday that U.S. natural-gas supplies in storage declined by 75 billion cubic feet for the week that ended Feb. 2. That was generally in line with the average drop of 76 billion cubic feet forecast by analysts polled by S&P Global Commodity Insights.
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