Sign In with Google
Sign In with Facebook
Oil future Prices Ascend Amid Increasing Red Sea Hostilities
On Thursday, oil futures experienced a rise in market value as the Iran-backed Houthis continued their aggression near Yemen in the Red Sea. However, the increase in U.S. crude reserves to some extent curbed the gains. Brent crude futures showed improvement, with a 64 cent (0.77%) increase, closing at $83.67 per barrel. At the same time, U.S. West Texas Intermediate crude futures also rose by 70 cents (0.9%), finishing at $78.61 per barrel.
Negotiators Head to Gaza Amid Mounting Pressure in the Middle East
Prime Minister Benjamin Netanyahu's war cabinet ratified the decision to deploy negotiators to Gaza for peace discussions happening in Paris, as reported by Israel's Army Radio. This move comes as tension escalates in the Middle East. Concurrently, the Houthi group in Yemen, affiliated with Iran, declared increased assaults in the Red Sea using submarine weaponry - a show of solidarity with Palestinians amid the Gaza conflict.
Continued Unrest in the Red Sea Raises Market Concerns
As the hostility in the Red Sea continues to brew, market players are growing increasingly concerned, according to John Kilduff from New York-based firm, Again Capital. He added that the primary supply issues are being felt in Europe, which indirectly affect the U.S. as it could drive demand for U.S fuel.
Crude Gains Capped by Surging U.S. Oil Inventory
Despite the rise in oil future prices, the growth was somewhat dampened due to an increase in U.S. oil stockpile as a result of refinery maintenance and outages. There was an increase in U.S. crude reserves by 3.5 million barrels to a total of 442.9 million barrels during the week ending February 16, revealed the U.S. Energy Information Administration. With many large refineries currently under maintenance, there has been a surge in crude inventory, with operation levels plunging to their lowest in two years.
Refinery Restart Attempts Offer a Glimmer of Hope
Despite the current setbacks, there is hope on the horizon as BP's 435,000 barrel-per-day Whiting refinery in Indiana is expected to be fully functional by March. Major refineries such as TotalEnergies' in Port Arthur, Texas, are also aiming to restart operations, despite currently functioning at a minimal capacity due to power outage issues.
