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Oil prices are up today (Thursday) for the first time in three days for the following two reasons.
New York's main contract and oil price benchmark West Texas Intermediate (WTI) for April delivery rose $0.11 to $101.56 a barrel, after reaching as low as $100.13 a barrel in intraday trading. The volume of all futures traded was around 42% over the 100-day average.
Brent crude for April added $0.34 (0.3%) to $108.10 a barrel, after reaching an intraday low of $107.37 a barrel, on the ICE Futures exchange in London. Volume was 33% over the 100-day average.
The first cause for higher oil prices today was news of mounting pressures in Ukraine.
The Russian-backed parliament in Crimea announced Thursday morning that it will hold a referendum on whether to secede from Ukraine and formally join the Russian Federation.
Later in the day, U.S. President Barack Obama called the referendum "illegal." He said the United States will move forward on sanctions on "individuals and entities responsible for violating the sovereignty and territorial integrity of Ukraine."
"Perhaps people are reluctant to go home short given what could happen in the Ukraine overnight," Citigroup energy futures specialist Tim Evans said to The Wall Street Journal.
The second reason why oil prices rose today was the release of the weekly jobless claims report, which reflected that fewer Americans than estimated filed applications for unemployment benefits last week. When U.S. economic data is good, it generally helps the oil market.
"The jobless report is driving up the stock market and oil," Energy Analytics Group LLC director Tom Finlon said to Bloomberg. "A weak dollar makes for a stronger market. I don't see oil going below $100. The Ukraine crisis is not over yet."
U.S. oil prices reached a five-month high on Monday amid the threat of an armed conflict with Russia, but have since fallen back on those gains as the political situation ebbed slightly this week; plus, a rise in stockpiles also dragged oil prices.
- The Wall Street Journal:
Crude Oil Rises on Eastern Europe Tension
WTI Crude Rebounds on U.S. Jobless Claims as Brent Above $108