DTN Oil Update
Oil Futures Extend Rise, Stay on Track for Weekly Gain
VIENNA (DTN) -- Oil futures rose for a second consecutive day on Friday morning, supported by geopolitical risks which propelled key crude benchmarks 3% higher in the previous session. The jump followed a two-day selloff on prospects of higher supply from Venezuela.
WTI futures for February delivery rose $0.53, or 1%, to $58.29 bbl. The ICE Brent contract for March climbed $0.55, or 0.9%, to $62.54. WTI was on track to a weekly gain of nearly 3% while Brent showed an advance of more than 3%.
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Downstream, NYMEX ULSD futures for February delivery climbed $0.0239 to $2.1434 gallon, and front-month RBOB futures was higher by $0.0143 to $1.7957 gallon.
The U.S. Dollar Index was little changed, up 0.052 points to 98.74, against a basket of foreign currencies.
While the impact of Thursday's drivers, including secondary sanctions on buyers of Russian oil and a weekly draw in U.S. crude inventories, remained in place, the current session was also lifted by protests across Iran that challenged its regime and raised supply risk concerns. Iran produces some 3.2 million barrels per day (bpd).
Russian strikes on Ukrainian energy infrastructure added to the risk premium on oil.
The bullish pivot in oil came after overwhelmingly bearish sentiment fueled by widespread expectations of a growing crude glut. Goldman Sachs, in a newsletter this morning, said that a client survey conducted this week revealed that investor bearishness on oil reached extremes in January. "Over the past 10 years, this level of bearishness has only been observed once: just after the U.S. Liberation Day tariff announcement on April 2, 2025", the statement said.
The potential of additional supply from Venezuela comes amid a U.S. push to revitalize the country's oil industry exacerbated glut concerns. "At least 100 Billion Dollars will be invested by BIG OIL, all of whom I will be meeting with today at The White House," U.S. President Donald Trump announced on his Truth Social media site this morning.
While a wave of Venezuelan crude from storage may soon be bound for the U.S., ramping up production will likely take years of investment into Venezuela's decrepit oil infrastructure. Treasury Secretary Scott Bessent on Thursday said big oil companies have so far been slow to respond to the White House's initiatives.
