Oil prices surged for the second consecutive day on Thursday, driven by a larger-than-expected decline in U.S. crude inventories, which compounded growing concerns over global supply disruptions linked to U.S. sanctions on Russian energy exports.
Brent crude futures increased by 30 cents, or 0.4%, reaching $82.33 per barrel at 0120 GMT. This followed a 2.6% jump in the previous session, marking the highest price level since July 26. Similarly, U.S. West Texas Intermediate (WTI) crude futures climbed 32 cents, or 0.4%, to $80.36 a barrel, after gaining 3.3% the day before, reaching its highest point since July 19.
The price uptick came after the U.S. Energy Information Administration (EIA) revealed on Wednesday that domestic crude oil stockpiles had fallen for the seventh consecutive week, the longest streak of declines since July 2021.
As global crude supplies are forecast to tighten, new sanctions on Russian oil producers and tankers are exacerbating the situation. These sanctions have caused Russian buyers to scramble for alternative oil sources, driving up shipping rates as well.
The International Energy Agency (IEA) warned in its latest monthly market report that the latest sanctions could significantly impact Russian oil production and distribution.
Despite the recent price rally, experts believe that the Organization of Petroleum Exporting Countries (OPEC) and its allies will remain cautious about increasing output. Rory Johnston, founder of Commodity Context, noted that after facing several setbacks over the past year, the group is likely to adopt a more conservative approach before easing production cuts.
However, the surge in oil prices was tempered by geopolitical developments. An official confirmed that Israel and Hamas have reached an agreement to halt the ongoing conflict in Gaza, which includes an exchange of Israeli hostages for Palestinian prisoners.
Related topics:
Retail Investor Sell-off Threatens to Derail China’s Stock Market Recovery
China’s Securities Regulator Pledges to Stabilize Market Amid Sluggish Start to 2025
Thaksin Shinawatra Calls for Overhaul of Thailand’s Stock Market to Restore Investor Confidence
