Shipping concerns caused oil prices to rise, but US stockpiles capped increases

Shipping concerns caused oil prices to rise, but US stockpiles capped increases

At 11:49 ET (1649 GMT), Brent oil futures increased 51 cents to $83.54 a barrel. At $78.55 a barrel, U.S. West Texas Intermediate oil futures saw a 64-cent increase.

Shipping concerns caused oil prices to rise, but US stockpiles capped increases.

Although there was a significant rise in US crude stocks, oil prices gained on Thursday despite ongoing assaults on vessels in the Red Sea close to Yemen.

At 11:49 ET (1649 GMT), Brent oil futures increased 51 cents to $83.54 a barrel. At $78.55 a barrel, U.S. West Texas Intermediate oil futures saw a 64-cent increase.

The ship caught fire after two missiles launched at it on Thursday off the southeast coast of Yemen, according to British marine services. The Houthis are assaulting ships to demonstrate their support for the Palestinians in the Gaza conflict.

“The geopolitical risk premium will always be at an elevated level due to the hostilities in and around the Red Sea by Iran-backed Houthi rebels on merchant vessels,” said Tamas Varga of PVM Oil.

The increase in crude oil stockpiles that followed refinery maintenance and outages last week did not, however, result in significant gains.

The U.S. Energy Information Administration said on Thursday that the country's crude oil stocks increased by 3.5 million barrels to 442.9 million barrels for the week ending February 16, compared with the 3.9 million barrel increase that experts surveyed by Reuters had predicted.

Crude inventories in the United States have increased as a result of significant refinery closures, which has caused utilization rates to drop to their lowest point in two years even though plant output is about to restart.

According to EIA statistics released on Thursday, the refinery utilization rate remained constant at 80.6% last week. A Reuters poll of experts predicted that the rate would increase to 81.5%.

Those familiar with plant operations say that BP's Whiting refinery in Indiana, which processes 435,000 barrels per day (bpd) and is the biggest in the US Midwest, will resume full production in March after a power outage that began on February 1.

Although it is currently only partially running after weather-related power interruptions, TotalEnergies' 238,000-bpd refinery in Port Arthur, Texas, is also attempting to resume.

Refined petroleum products, such as heating oil and diesel, are no longer in stock due to the outage. In contrast to predictions of a 1.7 million barrel reduction, EIA data revealed that stocks decreased by 4 million barrels throughout the course of the week to 121.7 million barrels.