U.S. crude oil prices closed at $102 per barrel after surging 50%
Oil futures jumped significantly following the collapse of Iran negotiations, but remain below wartime highs despite Middle East fighting.
U.S. crude oil prices reached $102 per barrel on Thursday, marking their highest closing value since May. Futures contracts rose approximately 50% from a summer low of $68.55, which occurred three weeks after the failed July memorandum of understanding between Washington and Tehran. The rally coincided with escalated fighting in the Middle East, where Saudi Arabia's major East-West pipeline was shut down following multiple attacks. Bob McNally, president of Rapidan Energy, noted that the market has begun restoring a risk premium since the agreement collapsed and naval blockades resumed. However, current prices remain below the April 7 wartime peak of $112.95. Rebecca Babin, senior energy trader at CIBC Private Wealth, stated that while markets have accounted for the fighting, they may not fully factor in potential increases in Chinese imports. She indicated that demand could tighten further as refineries in China ramp up production. China previously acted as a swing consumer by cutting crude imports from 3 million barrels per day to around 5 million barrels during the conflict. Analysts suggest China's upcoming import decisions will be critical for sustaining or raising prices.
