Oil futures settled higher as an agreement to stop months of deadly fighting in Ukraine assisted in easing concerns over the Russian oil demand, but continuing inventory build in the US kept the prices in check.
Natural gas futures suffered their first drop in four sessions with traders showing disappointment over the size of the latest decrease in US inventories.
The Wall Street Journal reported that Front-month West Texas Intermediate, the US benchmark, settled higher 4.9% or $2.37 at $51.21 per barrel on the New York Mercantile Exchange. Front-month March contract or Brent crude rose 4.4% or $2.39 cents to $57.05 per barrel on London’s ICE Futures Exchange.
The German and French leaders brokered a deal to end the 10-month conflict of Ukraine with Russia-based separatists.
Market Watch quoted Phil Flynn, senior market analyst at Price Futures Group as having said, “In short, the cease fire in Ukraine with Russia will lower the chances of new sanctions on Russia, which should help the growth outlook for the region.”
He added, “This comes against a backdrop of massive central bank easing, which should help kick-start some demand. While the oil market still has some very bearish supply issues to overcome from a price standpoint, the action is looking more like a bottom.”
Dominick Chirichella, analyst at the Energy Management Institute said, “The market remains in a mode of discounting bearish news and continuing to embrace what might be in the future.”
March reformulated gasoline blendstock, or RBOB, settled up 3.4% or 5.23 cents to $1.5955 per gallon. March diesel settled up 5.5% 9.96 cents or $1.973 per gallon.
To contact the reporter of the story: Jonathan Millet at firstname.lastname@example.org