Crude oil futures jumped to settle above $50 a barrel on Tuesday as global news and a hurricane-induced slowdown in crude output lifted domestic prices to their highest level in over a week, according to Bloomberg MarketWatch.
On the New York Mercantile Exchange, November West Texas Intermediate crude gained $1.34, or 2.7%, to settle at $50.92 a barrel.
December Brent crude, the global oil benchmark, advanced 82 cents, or 1.5%, to end trading at $56.61 a barrel on London’s ICE Futures Exchange.
“The strongest global demand growth we have seen in at least the last two years, if not longer, gets some of the credit [as] it appears that [the Organization of the Petroleum Exporting Countries] sees the glut of oil almost gone,” said Phil Flynn, senior market analyst at Price Futures Group. “At the same time OPEC is calling on shale oil producers to help push prices even higher and complete one of the greatest oil and product supply drains in recorded history.”
Meanwhile, “geopolitical risk continues to be elevated in the current market, with President Trump’s threat to decertify the Iranian nuclear deal serving as the latest high-profile example,” said Robbie Fraser, commodity analyst at Schneider Electric. “The deal remains worth watching in terms of global oil dynamics considering the rapid rise in total Iranian oil exports that came with the removal of international sanctions in 2015,” said Fraser.
Investors are awaiting inventory data from the American Petroleum Institute to be released late Wednesday and the Energy Information Administration’s weekly supply report on Thursday. They are delayed by a day this week due to the Columbus Day holiday. Analysts polled by S&P Global Platts expect the EIA report to show a decrease of 400,000 barrels of crude oil for the week ending October 6.
Monthly reports from OPEC and the EIA are also due Wednesday, with the International Energy Agency’s due Thursday.
Back on the New York Mercantile Exchange, November natural gas climbed 5.8 cents, or 2.1%, to settle at $2.891 per million British thermal units.