AAA Daily Fuel Gauge Report for Friday, 1/15/21

Brent crude oil hit a more than three-year high on Thursday, breaking through the psychologically important $70 a barrel level for the first time since December 2014. Oil futures failed to hold the gains, selling off as the close of trading approached, with analysts warning that the market might have little room left to run. Oil prices have been supported by stronger-than-expected demand fueled by worldwide economic growth, ongoing output limits by OPEC and Russia and a series of global events that have stoked geopolitical tension. Click Read More below for additional information.

Futures in New York rose as much as 1.3 percent after climbing the most in eight months on Tuesday. President Donald Trump has intensified preparations for a response to a suspected chemical weapons attack in Syria, a move that could place the U.S. in direct conflict with Russian forces. While the Middle East country’s own oil production is limited, prices often respond to the risk of war in a region that holds almost half of the world’s crude reserves. “The focus is on the West’s probable military strike against the Syrian regime,” said Carsten Fritsch and Eugen Weinberg, analysts at Commerzbank AG in Frankfurt. Click Read More below for additional information.

Futures were steady in New York after rising 3.8 percent in the previous three sessions. Global demand will climb this year by the most since 2015, the IEA said Wednesday. OPEC on Tuesday raised estimates for the amount of crude it will need to supply in 2018 on stronger consumption from Europe and China. U.S. oil output gained last week as operations returned after Hurricane Harvey. The IEA report “was taken as confirmation of the prevalent supply-tightening narrative, that that oil surplus is slowly disappearing,” said Norbert Ruecker, head of commodity research at Julius Baer Group Ltd. Still, crude is “trading at the upper end of a fundamentally justified price range” and the “upcoming seasonal demand soft patch is set to create near-term headwinds.” Click Read More below for more of the story.