Oil prices rose slightly on Thursday morning, amid investor concerns about escalating tensions between the US and Iran over fears that any attacks on Tehran or shipping could lead to supply disruptions, UNN reports, citing Reuters.
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Brent crude futures rose 27 cents, or 0.39%, to $69.67 a barrel at 03:50 GMT (05:50 Kyiv time). US West Texas Intermediate crude rose 29 cents, or 0.45%, to $64.92.
Both benchmarks ended Wednesday's trading higher. Brent futures rose 0.87%, and WTI futures rose more than 1.05%, as investor concerns about US-Iran tensions overshadowed rising US oil inventories.
US President Donald Trump said on Wednesday after talks with Israeli Prime Minister Benjamin Netanyahu that they had not reached a "final" agreement on further action regarding Iran, but insisted on continuing negotiations with Tehran.
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On Tuesday, Trump said he was considering sending a second aircraft carrier to the Middle East if a deal with Iran was not reached, even as Washington and Tehran prepare to resume negotiations.
Last week, American and Iranian diplomats held indirect talks in Oman. The date and location of the next round of US-Iran talks have not yet been announced.
Sustained price above $65-66 would require further escalation in the Middle East, while any de-escalation could quickly trigger profit-taking around $60-61 for WTI crude, said IG analyst Tony Sycamore.
According to the US Department of Labor, employment growth in the country unexpectedly accelerated in January, and the unemployment rate fell to 4.3%, indicating a healthy economy. "A strong US economy also supports expectations for oil demand," said Minyu Gao, chief researcher in energy and chemicals at China Futures.
A significant increase in US oil inventories limited price growth. According to the Energy Information Administration, US oil inventories rose by 8.5 million barrels last week to 428.8 million barrels, significantly exceeding analysts' expectations.
However, since the beginning of the year, the growth of global oil inventories has generally been lower than expected, and net long positions in foreign oil futures and options have not yet reached a level of advantage, Gao noted.
Thus, oil prices are likely to remain biased towards growth, driven by the situation in US-Iran relations, tightening sanctions on Russian oil, and expectations of export cuts, Gao added.
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