DTN Oil Update
Brent at Highest Since May Amid Mideast Risks
HOUSTON (DTN) -- Oil futures climbed for a fifth-straight day Thursday as fears of global tighter supplies intensified after Houthi forces reportedly attacked two Saudi Arabian oil tankers in the Red Sea, days after the group a blockade of Saudi ports.
Front-month ICE Brent futures contract climbed back to the $100 mark rising by $6.22, or 6.6%, to $100.29 bbl, the highest since May 19 when the benchmark traded at $102.1 bbl, DTN data showed. Meanwhile, the NYMEX WTI futures contract for September delivery increased $4.97, or 5.7%, to $91.80 bbl, its highest settlement since May 20 when it was at $90.01 bbl.
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NYMEX ULSD futures for August delivery soared $0.2009 to $4.3497 gallon, and front-month RBOB futures advanced $0.0741 to $3.4888 gallon.
The U.S. Dollar Index advanced by 0.326 points to 101.280 against a basket of foreign currencies.
The attacks by the Iran-aligned Yemeni militia threaten another vital oil shipping route from the Middle East to global consumers. They also risk disrupting millions of barrels per day of crude exports rerouted from the locked-in Persian Gulf to Saudi Arabia's Red Sea port of Yanbu.
The fresh disruptions to supply override domestic inventory buffers reported by the U.S. Energy Information Administration. U.S. commercial crude inventories rose by 2.0 million bbl to 411.7 million bbl during the week ended July 17, accompanied by modest builds in gasoline and distillate stocks.
U.S. gasoline stockpiles, at 211.3 million bbl, remained at their lowest since November and the lowest for this time of year since 2012.
Tight global fuel inventories have propelled refining margins to all-time highs. U.S. refiners have been running at near full capacity for weeks, setting a post-pandemic high in crude oil processing despite diminished capacity, EIA data showed.
This sustained high processing pace and accompanying maintenance deferments greatly increase outage risks, which ironically serves as yet another catalyst for soaring product cracks.