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Oil futures continued to rise Thursday, as traders looked past surprise increases in U.S. supplies, and instead focused on the possibility that the U.S. will reimpose sanctions on Iran.
June West Texas Intermediate crude rose 13 cents, or 0.2%, to $68.18 a barrel after rising 0.5% on Wednesday. Global benchmark June Brent added 36 cents, or 0.5%, to $74.36 a barrel, after a 0.2% rise Wednesday.
On Wednesday, a report from the U.S. Energy Information Administration showed that crude oil supplies rose by 2.2 million barrels for the week ended April 20. Analysts surveyed by S&P Global Platts had forecast a decline 1.1 million barrels. On Tuesday, the American Petroleum Institute reported an increase of 1.1 million barrels, according to sources.
While U.S. oil production continues to set records, any event in the Middle East that impacts output in that region could push the market to fresh 3 1/2-year highs, said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.
Despite French President Emmanuel Macron’s efforts at brokering a new deal between Washington and Iran, investors remain circumspect about the possibility of fresh sanctions being imposed again by the U.S., analysts say.
Crude prices had been bolstered by growing expectations that President Donald Trump will try to pull the U.S. out of a 2015 international accord to curb Iran’s nuclear program. That would likely trigger a reimposition of economic sanctions and frustrate the Islamic Republic’s oil output, reducing global supply.
Prices wobbled after Trump, following a meeting with Macron at the White House on Tuesday, signaled an interest in an unspecified potential new deal to rein in Iran’s nuclear program.
But analysts said investors will have to ride out the rhetoric, which is likely to just increase before May 12, the Iranian sanctions waiver deadline.
Among other energy contracts, May gasoline rose 0.4% to $2.098 a gallon, while heating oil for the same month added 0.6% to $2.148 a gallon.
May natural gas slipped 0.1% to $2.782 per million British thermal units ahead of a weekly EIA update due Thursday on supplies of the commodity.
Myra P. Saefong contributed to this article