Oil prices continued their upward trend, settling above $72 per barrel amid ongoing supply uncertainty and a weak dollar, which made dollar-denominated commodities more attractive to investors. The rise marked the third consecutive session of gains as concerns over potential supply disruptions persisted. The market remained on edge following the disruption of a key Kazakh pipeline, alongside speculation that OPEC+ may delay a planned production increase.
The prospect of tightening global supply has supported crude prices despite broader market volatility. However, trading activity has slowed after a volatile start to the year, with investor repositioning ahead of contract expirations affecting the West Texas Intermediate (WTI) prompt spread, which has recently approached a contango structure. Oil prices have largely moved within a narrow range in February, as traders weigh policy changes under U.S. President Donald Trump’s administration.
Analysts at Royal Bank of Canada, including Brian Leisen, noted that crude markets are likely to remain rangebound, responding to headlines rather than fundamental shifts. “As more time passes without the market realizing a substantial catalyst, traders will tend to position themselves closer to average prices,” they stated in a research note. U.S. government data indicated a fourth consecutive weekly increase in commercial oil inventories, with stockpiles rising by 4.63 million barrels last week.
The buildup exceeded projections from industry analysts and media survey estimates, adding to concerns over supply and demand imbalances. Despite this, crude prices held firm on broader macroeconomic factors, including the dollar’s decline. Meanwhile, gasoline futures reversed earlier losses, climbing as much as 0.9% following reports that refiners are shifting production away from gasoline toward diesel. The adjustment comes as demand for diesel surges due to cold weather conditions across the U.S., prompting refiners to optimize output to meet market needs.
The broader energy sector continues to assess the potential impact of geopolitical developments and economic policies on crude demand. With uncertainty surrounding OPEC+ production strategies and potential shifts in U.S. energy policies, volatility remains a key theme in oil markets. Investors are closely monitoring signals from major producers, as well as shifts in currency dynamics that could further influence price movements. As the market navigates these uncertainties, oil prices remain sensitive to any developments in supply constraints and broader macroeconomic trends. – By MENA Newswire News Desk.