Oil prices stabilized on Thursday following a recent decline, as worries about disruptions in Red Sea shipping routes eased, even though tensions in the Middle East continued to escalate.
Brent crude futures saw a marginal increase of 10 cents, or 0.1%, reaching $79.75 a barrel by 0424 GMT.
Meanwhile, U.S. WTI crude futures experienced a slight decrease of 5 cents, settling at $74.06 a barrel.
The previous day witnessed a nearly 2% drop in prices as major shipping companies resumed operations in the Red Sea.
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Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities, commented, “Concerns about shipping in the Red Sea have eased, but continued worries about tensions in the Middle East, especially on Iran’s involvement in the region, make it difficult to sell further.”
He added, “The market is likely to try the upside again… maybe in the early new year, also on expectations of a recovery in fuel demand thanks to monetary easing in the United States and higher kerosene demand during the winter in the northern hemisphere.”
Maersk, a Danish shipping company, announced the resumption of several dozen container vessels scheduled to travel via the Suez Canal and Red Sea in the coming weeks.
This decision follows a temporary halt in these routes due to attacks by Yemen’s Iran-backed Houthi militia.
Despite this positive development, the potential for a prolonged Israeli military campaign in Gaza and the spillover of the conflict to attacks on ships in the Red Sea continue to influence market sentiment.
On Wednesday, Israeli forces intensified their assault on central Gaza through land, sea, and air operations. Israel’s chief of staff, Herzi Halevi, indicated that the war would persist “for many months.”
Additionally, the U.S. government’s release of fuel stockpile data, delayed by a day due to the Christmas holiday, is anticipated on Thursday.
Data from the American Petroleum Institute revealed a surprising increase of 1.84 million barrels in crude stocks for the week ending Dec. 22, contrary to estimates anticipating a drop of 2.7 million barrels from seven analysts polled by Reuters.
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