U.S. oil holds to gains after three weeks of crude inventory declines

U.S. oil futures on Thursday held to gains after jumping 2.6% in the previous session as crude inventories fell for the third week in a row.

U.S. commercial crude inventories fell by 4.9 million barrels last week, though gasoline stocks rose by 3.3 million barrels and motor fuel demand weakened by 615,000 barrels per day.

Here are Thursday’s closing energy prices:

• West Texas Intermediate August contract: $82.82 per barrel, down 3 cents. Year to date, U.S. crude oil has gained 15.6%.
• Brent September contract: $85.11 per barrel, up 3 cents. Year to date, the global benchmark is ahead 10.5%.
• RBOB Gasoline August contract: $2.51 per gallon, up 1 cent, or 0.6%. Year to date, gasoline is up 19.7%.
• Natural Gas August contract: $2.12 per thousand cubic feet, up 9 cents, or 4.42%. Year to date, gas is down 15.4%.

Falling oil inventories, geopolitical tensions in the Middle East, seasonal demand and expectations of lower interest rates have all coincided to push oil prices higher in recent weeks, Bart Melek, head of commodity strategy at TD Securities, told clients in a note late Wednesday.

“However, we don’t expect the current rally to be sustained,” Melek said. West Texas Intermediate and Brent are expected to fall to $78 per barrel and $82 per barrel, respectively, in the early part of 2025 as the market enters a surplus and geopolitical tensions ease, he said.

But the market will be volatile as hurricanes, uncertainty in the Middle East, policy in China, and statements from OPEC all have the to potential to move prices, according to Melek.