Crude Oil Futures Gains as Worries over Global Supplies Escalate

Crude oil futures jumped on Tuesday to settle above $101 per barrel as investors remained uncertain over global crude oil supplies due to tensions in Iran. Moreover better than expected US consumer confidence data further helped the crude oil to appreciate.

President of Prestige Economics, Jason Schenker commented, “The Iranian statements threatening a close of [the Strait of] Hormuz are a big driver of prices today, noting that the statements have “become increasingly bolder, and that’s pushing crude oil prices higher,” he further added, “Their rhetoric of political brinkism is swiftly approaching a point of no return.”

As per the latest data on US Conference Board, the consumer confidence index rose to 64.5 for the month of December as compared to revised figure of 55.2 for the month of November which further boosted investors’ sentiments.

Crude oil futures for February delivery jumped 1.7 percent or $1.66 to settle at 4101.34 per barrel on the New York Mercantile Exchange. Crude oil futures have been moving in a strong rally since its last 6 sessions and have gained 6.6 percent for the week so far.

London’s Brent for February delivery surged 1.2 percent or $1.31 to settle at $109.27 per barrel on ICE Futures exchange. Among other commodities, gasoline futures contract for January contract slightly gained 0.1 percent to close at $2.69 per gallon. Heating oil futures for January delivery advanced 0.6 percent or $0.18 to settle at $2.91 per gallon while Natural gas futures for the same month delivery fell0.1 percent to $3.11 per million British thermal units.

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