Crude-oil futures settled higher on Thursday, with both the U.S. and international benchmarks tapping intraday highs above $100 for the first time since 2014, as Russian troops and tanks pushed into Ukraine and airstrikes hit the country in an attack authorized by President Vladimir Putin in a televised address to his nation.
West Texas Intermediate crude for April delivery
rose 71 cents, or 0.8%, to settle at $92.81 a barrel on the New York Mercantile Exchange, well below the session’s high of $100.54.
April Brent crude
the global benchmark, settled $2.24, or 2.3%, higher at $99.08 a barrel on ICE Futures Europe after touching $105.79. Both international and U.S. contracts hit their highest intraday level since 2014.
March natural gas
fell 1.2% to $4.568 per million British thermal units on the contract’s expiration day, reversing course after earlier gains lifted prices to as high as $4.94.
added 1.7% to $2.771 a gallon and March heating oil
rose 2.4% to $2.897 a gallon.
The Russian attack on Ukraine is viewed as the largest such military operation in Europe since the Balkan Wars of the 1190s and possibly since World War II and is likely to spark concerns about supply disruptions, during a period of uncertainty in the global economy underpinned by COVID worries and supply-chain bottlenecks.
Read: Ukraine invasion sends wheat, corn and oil soaring because Russia is a ‘commodity superstore’
Russia supplies between 30% and 40% of Europe’s natural gas.
Analysts have said that the Ukraine conflict increases the risk of disruptions to Russian oil and natgas supplies and the sanctions and the effect of higher oil prices, could exacerbate global inflationary pressures.
Read: Why Russia’s invasion of Ukraine may lift oil prices to a 14-year high
Also see: U.S. drivers brace for the highest gas prices in 9 years as oil approaches $100 a barrel
President Joe Biden unveiled additional U.S. sanctions against Russia on Thursday, blocking more banks, but analysts had said the latest sanctions could include kicking Russia out of the SWIFT payment network. Biden said a move on WIFT remains an option.
Stewart Glickman, energy equity analyst at CFRA Research, said his company believes Biden has “little appetite for policy moves that would cause further pain at the pump for U.S. drivers.”
So, there’s a risk of WTI prices overshooting the mark and settling back in the $90 range, and that would “reflect the existing tight market for crude, but would be absent sanctions that matter,” he said.
The Energy Information Administration reported on Thursday that U.S. crude inventories rose by 4.5 million barrels for the week ended Feb. 18. Data were released a day later than usual due to Monday’s Presidents’ Day holiday.
On average, analysts had forecast a decline of 300,000 barrels, according to a poll conducted by S&P Global Platts. The American Petroleum Institute late Wednesday reported a 6 million-barrel increase, according to sources.
The EIA also reported weekly inventory declines of 600,000 barrels each for gasoline and distillates. The S&P Global Platts survey expected supply declines of 1.1 million barrels each for gasoline and distillates.
The EIA data showed crude stocks at the Cushing, Okla., Nymex delivery hub fell by 2 million barrels for the week, while stocks in the Strategic Petroleum Reserve were down by 2.4 million barrels.
Separately, the EIA said domestic natural-gas supplies fell by 129 billion cubic feet last week.