The price of major oil benchmarks jumped more than 3 percent on Thursday following increased fuel demand in the United States due to Hurricane Milton and Middle East supply risks.

Brent crude oil, against which Nigerian oil is priced, rose $2.82, or 3.7 percent to settle at $79.40 a barrel, while the US West Texas Intermediate (WTI) crude rose $2.61, or 3.6 percent, to settle at $75.85.

In the US, the world’s largest oil producer and consumer, Hurricane Milton hit Florida and knocked out power to more than 3.4 million homes and terminals.

Market analysts noted that the closures of several product terminals, delayed tanker truck deliveries and disrupted pipeline movement will likely be affecting supplies well into next week given broad based power outages.

This will serve as a positive news for the market as disruptions generally lend support.

Recall that crude benchmarks spiked earlier this month after Iran launched more than 180 missiles against Israel on October 1.

This raised the prospect of retaliation against Iranian oil facilities. Iran is backing several groups fighting Israel, including Hezbollah in Lebanon, Hamas in Gaza and the Houthis in Yemen.

However, since Israel is yet to respond, crude benchmarks have eased.

Despite this, investors remained wary, given that Israel has vowed to wait and strike at the best time.

Israel has continued to fight in Lebanon as it Reuters reported that a strike on central Beirut on Thursday night killed 11 people and wounded at least 48.

In Yemen, the Houthis said they targeted vessels in the Red Sea and Indian Ocean in solidarity with the Palestinians in the war between Israel and Hamas in the Gaza Strip.

Meanwhile, Gulf states are lobbying the US to stop Israel from attacking Iran’s oil sites because they are concerned their own oil facilities could come under fire from Iran’s allies if the conflict escalates.

Support came as investors express confidence that the Federal Reserve would cut interest rates in November after data showed an increase in weekly jobless claims and an annual rise in inflation that was the lowest since February 2021.

The US central bank started to lower interest rates in September after hiking rates aggressively in 2022 and 2023.

Oil prices fell on Wednesday after data showed crude oil inventories grew in the United States.

However, losses were contained by the heightened risk uncertainty caused by the Middle East conflict and Hurricane Milton in the US.

Brent crude oil, against which Nigerian oil is priced, dipped 60 cents, or 0.8% to settle at $76.58 a barrel while the US West Texas Intermediate (WTI) crude oil shed 33 cents or 0.5% to $73.24 a barrel.

The Energy Information Administration said on Wednesday that crude inventories rose last week in the US while fuel inventories fell sharply. Back-to-back major hurricanes drove high demand to nearly a three-year high.

Crude inventories rose by 5.8 million barrels to 422.7 million barrels in the week ended October.

The build estimate pressured oil prices which were already facing uncertainties from a host of other developments.

On Tuesday, fears of an escalation in the Middle East gave way to hopes of a ceasefire between Israel and Hezbollah.

The market was also on the lookout as the US, the world’s largest oil producer, faced a second major storm, Hurricane Milton, which came with tornadoes and lashing rain in Florida on Wednesday.

US President Joe Biden spoke with Israeli Prime Minister Benjamin Netanyahu about Israel’s plans concerning oil producer Iran in a call on Wednesday.

If Israel attacks Iran’s oil infrastructure, it could lead to a supply deficit but analysts say other producers like Saudi Arabia and the United Arab Emirates (UAE) could step in to fill the gaps.

Investors have also expressed worries about slow growth dampening fuel demand in China, the world’s largest crude importer.

Chinese policymakers’ failure to deliver new economic stimulus measures at a press briefing this week. This also held energy prices in check.

An Italian court has sentenced two Milan prosecutors, Fabio De Pasquale and Sergio Spadaro, to eight months imprisonment for concealing evidence in an alleged corruption case involving a $1.3 billion oilfield in Nigeria.

The court found the duo guilty after it was established that they failed to file documents that could have supported Eni’s defense in the trial.

Regarded as one of the energy industry’s most significant corruption trials, the case which involves Eni and Shell centered around the $1.3 billion acquisition of a Nigerian oilfield.

In 2020, the Nigerian government filed a case against Shell/SNUD and Eni asking for compensation in the sum of $1.3 billion over an Oil Prospecting License 245, also known as OPL 245.

The case which had dragged on for over a decade came to a halt when the Ministry of Justice withdrew its petition in an Italian Court in March 2024.

Meanwhile, an international Court in Italy had already declared Shell and its affiliate partners not guilty on all counts.

Nigeria also decided to “irrevocably” suspend any future legal claims in Italy against Eni, its affiliates, as well as present and former officers concerning rights related to the field.

Meanwhile, delivering judgement on the refusal of the prosecutors to tender evidence, the court stated that De Pasquale and Spadaro had omitted key evidence, including a video from a former Eni external lawyer that could have been favourable to the defence.

The court sitting in Brescia and has jurisdiction over judicial matters in Milan had listened to the argument of the prosecutors who accused De Pasquale and Spadaro of withholding evidence that could have influenced the outcome of the Eni-Shell trial, thereby infringing on the defendants’ rights.

Responding to the charges, the prosecutors’ lawyer sought a full acquittal, arguing that no explicit rule mandated the filing of documents by prosecutors in such cases.

In March 2021, a Milan court acquitted Eni, Shell, and all other defendants, despite criticisms of the prosecutors’ conduct.

Judges ruled that the two prosecutors had a legal duty to submit evidence that might have aided the defense. The lawyer did not offer immediate comments following the conviction.

Afterward, the Brescia court sentenced the duo to eight-month jail term as requested by the prosecutors.