A flare stack burns beyond oil storage tanks at the Taneco Oil Refining and Petrochemical complex, operated by Tatneft PJSC, in Nizhnekamsk, Tatarstan, Russia, on March 5, 2019.
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Crude oil futures were flat Thursday, taking a breather as traders took stock of the market after prices advanced more than 2% this week to hit the highest level since October.
The West Texas Intermediate contract for May delivery gained 2 cents to $85.45 a barrel, while the Brent contract for June delivery was unchanged at $89.35.
Oil prices have rallied this year, booking three consecutive months of gains with U.S. crude adding 19% while Brent is up about 16%.
The rally comes as the wars in Eastern Europe and the Middle East raise renewed fears about supply disruptions. Ukraine has repeatedly struck Russian oil refineries, reducing the OPEC+ member’s capacity.
Tensions are also mounting between OPEC member Iran and Israel, after Tehran accused the Netanyahu government of striking its consulate in Damascus.
The market is also expected to enter a deficit 450,000 barrel per day in the second quarter as demand grows while global inventories fall as OPEC+ members voluntarily slash production.
An OPEC+ committee on Wednesday recommended no changes to the group’s current production policy. Some members are voluntarily slashing 2.2 million barrels per day.