Oil rises 2% after the rejection of a truce proposal in Gaza and US inventory data
Oil prices rose more than 3% today, Thursday, as investors evaluate the impact of Israel’s rejection of a proposal from the Palestinian Islamic Resistance Movement (Hamas) for a ceasefire and an unexpected decline in US fuel stocks.
Brent crude futures rose $2.42, or 3.06%, to reach $81.63 per barrel upon settlement, while US crude futures increased $2.36, or 3.2%, to reach $76.22 per barrel upon settlement.
Brent crude oil exceeded $80 per barrel for the first time since February 1, continuing its gains for the fourth session in a row.
Israeli forces bombed the border city of Rafah, south of the Gaza Strip, on Thursday, after Prime Minister Benjamin Netanyahu rejected a proposal for a truce agreement.
Tamas Varga, an analyst at BVM, said, “The recent increase is due to the Israeli response to the offer made by Hamas in response to the original peace plan, which indicates that the unrest in the Red Sea will continue unabated.”
A Hamas delegation headed by the movement’s senior leader, Khalil al-Hayya, arrived in Cairo on Thursday to hold talks with Egypt and Qatar about a ceasefire.
But the oil market received support from a larger-than-expected decline in gasoline and distillate stocks in the United States.
Energy Information Administration data showed that distillate stocks fell by 3.2 million barrels to 127.6 million barrels, versus expectations of a decrease of one million barrels. Gasoline stocks fell by 3.15 million barrels, compared to analysts’ expectations of an increase of 140 thousand barrels.
Varga said that the decrease in fuel stocks and the increase in crude stocks are a sign of the start of maintenance work in American refineries.
He added, “Refinery maintenance in the United States and fuel shortages in Europe may help maintain positive sentiment at the present time.”
In Russia, the damage to refineries, as a result of Ukrainian drone attacks, and technical malfunctions led to an increase in crude oil exports beyond the quantities planned for February, in a trend that, according to analysts, may affect Moscow’s pledge to reduce crude sales under the agreement with the Organization of the Petroleum Exporting Countries. Petroleum Exporting Countries (OPEC) and its allies.
(Reuters)
2024-02-08 20:32:56
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