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Oil settles up, notches weekly gain on tight supply, Middle East conflict

Published 02/08/2024, 08:40 PM
Updated 02/09/2024, 03:35 PM
© Reuters. FILE PHOTO: A person puts gas in a vehicle at a gas station in Manhattan, New York City, U.S., August 11, 2022. REUTERS/Andrew Kelly/File Photo

By Laura Sanicola

(Reuters) -Oil prices settled higher on Friday, up about 6% on a week-on-week basis, as worries about supply from the Middle East mounted and as reining outages tightened refined products markets.

Brent crude futures settled up 56 cents, or 0.7%, at $82.19 a barrel. U.S. West Texas Intermediate crude futures settled up 62 cents or 0.8%, at $76.84 a barrel.

Oil futures rose throughout the week, buoyed after Israeli Prime Minister Benjamin Netanyahu's rejection of a Hamas ceasefire proposal on Wednesday. This week's rise followed a 7% loss in the prior week.

"We believe that this type of week-to-week wide price swings will further characterize the crude markets through the rest of this month short of major bullish headlines out of the Mideast that could force adjustment in global oil balances," said Jim Ritterbusch, president of Ritterbusch and Associates LLC in Galena, Illinois.

U.S. energy firms this week also added 4 oil and natural gas rigs to 623 this week, its highest since mid-December, energy services firm Baker Hughes said in its closely followed report.

U.S. domestic production returned this week to a record 13.3 million barrels per day level, according to the U.S. Energy Information Administration. Last month, frigid weather caused widespread shut-ins in oil producing regions.

Israeli forces on Friday continued deadly air strikes on the Gaza Strip. On Thursday, the bombing of the southern border city of Rafah helped boost oil prices by around 3%.

"With the words that, 'no part of the Gaza Strip would be immune from Israel's offensive', it was not hard for oil participants to conclude that without even a passing regard for peace, there was not enough conflict-premium priced in," said John Evans, an analyst at PVM.

Crude futures were also supported by strength in gasoline and diesel prices as significant U.S. refinery downtime, both planned and unplanned, tightened product markets.

Gasoline futures rose about 9% in the week to $2.34 per gallon while heating oil futures increased by 11% to $2.96 per gallon.

Ukraine launched drone attacks against two oil refineries in southern Russia on Friday, resulting in a fire at the Ilsky refinery. The Afipsky refinery, also in Krasnodar Krai, which borders Crimea on the Black Sea and Azov Sea coast, was the other facility in the attack.

Russia has been exporting more crude in February than planned under an OPEC+ deal, following a combination of drone attacks and technical outages at its refineries.

© Reuters. FILE PHOTO: A person puts gas in a vehicle at a gas station in Manhattan, New York City, U.S., August 11, 2022. REUTERS/Andrew Kelly/File Photo

"Proof still needs to be provided that Russia is able to cut oil exports sufficiently even without weather-related constraints," Carsten Fritsch, an analyst at Commerzbank (ETR:CBKG), said on Friday in reference to the country's OPEC+ cut quota.

On Thursday, the U.S. Treasury Department sanctioned another three entities based in the United Arab Emirates (UAE) and one tanker registered by Liberia for violating a cap placed on the price of Russian oil by a coalition of Western nations.

Latest comments

yes, artificial supply cuts is the only thing that keeps oil so high. Look what happened to gas price: -80%! oil market IS NOT a free market.
You are free not to buy products derived from oil 🤪
JOE is not fit for being president. US save your self from these destruction. Trump was far better than Joe. Inflation and high crude price is due to current president.
Trump was an incompetent corrupt gasbag. he handed Biden an economy in shambles. his 2017 tax cut to the corporations and the wealthy added 1 trillion a year to the deficit and laid the ground work for the massive inflation cycle the country experience.
I think I should be one of must happiest man right now because am being blessed with a God fearing man that has chosen to help me out with my trade registration an I never believed I could get my payout but I did with the help of the man he is being blessed by god to dey people his WTSap(+)31612574318) 0101010010101 1001010101010101010101010010101010101010101010101010101001010101010115151515151515151515151515151515515151551515151515151515151515151515151515515151515151515155515151515151515151515151551515151515151515155151515151151515
stay away, dangerous spam
middle east excuse. How many times are we going to milk this excuse oil traitors?
Since many months back oil prices are not care technical or fundamental analysis.
the're are forms of technical analysis that work most of the time and can give you as much as a 70% chance of predicting price and times.
they are based on pattern recognition
Political!  Prices down at pumps, Americans think inflation coming down, which is not true. You can not keep giving away money you do not have; supporting illegal immigrants with money and programs that are becoming depleted for Americans; and not be in a bursting bubble of inflation. The ballon is discreetly being kept patched until after the election.  We, the People, have and are being stolen from and lied to.  It is only a matter of time before we will have to come to terms with the almost unbelievable financial and emotional distress this administration is causing us.  It will get worse before it can get better, but we must stop and correct the insanity before it is too late.
Terrorists are controlling oil price in USA
sounds like paranoia setting in Anthony.
Oil embargo
it will be down on monday
Price of oil too low.. pure manipulation
This high price is non-sense. Pure manipulation.
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