Crude prices moved higher early Thursday, with traders increasingly focused on geopolitical risks tied to strained relations between Washington and Tehran and the potential for disruptions to oil flows.
Brent crude futures rose 19 cents, or 0.27%, to $69.59 a barrel at 08:01 GMT. U.S. West Texas Intermediate (WTI) added 20 cents, or 0.31%, to trade at $64.83.
Both benchmarks had already closed higher on Wednesday, with Brent advancing 0.87% and WTI climbing more than 1.05%, as concerns over U.S.-Iran tensions outweighed news of a build in American crude inventories.
U.S. President Donald Trump said following discussions with Israeli Prime Minister Benjamin Netanyahu that no “definitive” agreement had been reached on how to proceed with Iran, although he emphasized that negotiations with Tehran would continue.
Earlier in the week, Trump indicated he was weighing the deployment of a second aircraft carrier to the Middle East if talks with Iran fail to produce an agreement, even as both sides prepared to resume discussions.
American and Iranian officials held indirect talks in Oman last week, but no date or location has yet been confirmed for the next round of negotiations.
According to IG analyst Tony Sycamore, a sustained move above the $65–$66 range in WTI would likely require further escalation in the region, while any signs of easing tensions could prompt profit-taking, potentially pushing prices back toward the $60–$61 area.
On the macro front, the U.S. Labor Department reported stronger-than-expected job growth in January and a drop in the unemployment rate to 4.3%, pointing to continued resilience in the American economy.
“The resilient U.S. economy is also supporting oil demand expectations,” said Mingyu Gao, chief researcher for energy and chemicals at China Futures.
However, gains were limited by a sharp rise in U.S. stockpiles. The Energy Information Administration reported that crude inventories increased by 8.5 million barrels last week to 428.8 million barrels, far exceeding analysts’ expectations in a Reuters poll for a 793,000-barrel increase.
Gao noted that, despite the latest data, global inventory builds have generally been lower than anticipated since the start of the year, and speculative long positions in overseas crude futures and options have not yet reached excessive levels.
As a result, oil prices are likely to retain an upward bias, supported by ongoing U.S.-Iran tensions, tighter sanctions on Russian crude and expectations of lower export volumes, Gao said.