Oil prices rose more than 2% on Thursday as investors assess the impact of Israel’s rejection of a ceasefire proposal in Gaza and an unexpected decline in US fuel inventories.
Brent crude futures rose $1.70, or 2.15%, to $80.91 a barrel, while West Texas Intermediate crude futures increased $1.61, or 2.18%, to $75.47 a barrel.
Brent crude surpassed $80 a barrel for the first time since February, continuing its fourth consecutive session of gains.
According to B.I.M analyst Tamas Varga, “The recent increase can be attributed to Israel’s response to Hamas’ counteroffer to the original peace plan, which indicates ongoing unrest in the Red Sea without relent.”
Israeli Prime Minister Benjamin Netanyahu rejected the latest ceasefire proposal and the release of hostages held in Gaza, but US Secretary of State Antony Blinken stated that there is still room for negotiation to reach an agreement.
However, the oil market received support from a bigger-than-expected decrease in gasoline and distillate inventories in the United States. Energy Information Administration data showed that distillate inventories fell by 3.2 million barrels to 127.6 million barrels, against expectations of a one million barrel decrease.
Gasoline inventories decreased by 3.15 million barrels, compared to analysts’ projections of a 140,000 barrel increase.
