Crude Oil Prices Up on Ceasefire Violation in Israel, Hezbollah Deal

Oil prices gained on Thursday after Israel and Lebanese armed group Hezbollah traded accusations that their ceasefire had been violated as the US Thanksgiving holiday limited trading.

Brent crude futures edged up by 30 cents, or 0.4 percent to $73.13 a barrel while the US West Texas Intermediate (WTI) crude futures were up 23 cents, 0.3 percent at $68.93.

The market had expected that the ceasefire would cool some risk but Israel’s military said the ceasefire was violated after what it called suspects, some in vehicles, arrived at several areas in the southern zone.

The deal, which took effect on Wednesday, was intended to allow people in both countries to start returning to homes in border areas after 14 months of fighting.

Meanwhile, the Organisation of the Petroleum Exporting Countries and its allies, OPEC+ delayed by a few days a crucial meeting likely to extend production cuts.

The group pushed its next policy meeting to Thursday, December 5 from December 1 to avoid a conflict with another event.

Members were discussing a further delay to a planned oil output hike that was due to start in January, to help prop up prices.

It will also be the last meeting of the 22-member group before Donald Trump assumes office as the next US President in January.

There are also concerns about the potential risk to Iran’s supply from sanctions that might be implemented under a Trump administration based on happenings in the first administration from 2016 to 2020.

The OPEC+ group pumps about half the world’s oil but has maintained production cuts to support prices. It hopes to unwind those cuts, but weak global demand has forced it to delay the start of gradual increases.

Slowing fuel demand growth in top consumers the US and China has weighed heavily on oil prices this year, although supply curtailments from OPEC+ have helped to limit the losses.

This was seen as US petrol stocks rose 3.3 million barrels in the week ended on November 22, the US Energy Information Administration (EIA) said on Wednesday.