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U.S. oil benchmark aims for 7th straight gain as natural-gas prices drop nearly 5%


Oil futures rose Tuesday, with U.S. benchmark prices poised to mark a seventh straight session gain, as traders continue to weigh risks to crude supplies tied to Middle East tensions and energy demand prospects.

Natural-gas futures, meanwhile, headed lower for a sixth consecutive session, on track to settle at their lowest since July 2020 on expectations for weaker U.S. demand and excess supplies.

Price moves

West Texas Intermediate crude

for March delivery


rose 42 cents, or 0.6%, to $77.34 a barrel on the New York Mercantile Exchange.

April Brent crude

the global benchmark, was up 36 cents, or 0.4%, at $82.36 a barrel on ICE Futures Europe.

March gasoline

added 0.3% to $2.3734 a gallon, while March heating oil

edged down by 0.6% to $2.9037 a gallon.

Natural gas for March delivery

traded at $1.683 per million British thermal units, down 4.9%. Based on the front month, prices are on track for their lowest finish since July 2020.

Oil’s market drivers

Crude oil held up well Tuesday “in the face of headwinds from a rising U.S. dollar and an OPEC report that suggested some, but not complete progress toward implementing production cuts,” said Colin Cieszynski, portfolio manager and chief market strategist at SIA Wealth Management.

In a monthly report Tuesday, the Organization of the Petroleum Exporting Countries left its forecast for growth in oil demand this year unchanged from its January outlook at 2.2 million barrels a day, or mbd, bringing total demand to 104.4 mbd

One bright spot was that markets in Japan and South Korea rallied overnight, he told MarketWatch. Since concerns about the impact of struggling Asia Pacific economies on energy demand have been weighing on crude lately, “it appears some of that pressure may have lifted for the moment.”

WTI, the U.S. benchmark, logged a sixth straight gain Monday, while Brent edged lower. Both grades had rallied more than 6% last week as jitters over the potential for conflict in the Middle East to threaten crude supply were once again on the rise.

“The market remains very volatile, with events in the Middle East creating upside risks. Then there’s the global economy and interest rates, the expectations of which are forever changing,” Craig Erlam, senior market analyst at Oanda, said in a note.

“Interest rate expectations have been pared back more recently but traders remain upbeat on the economic outlook. Of course, the further back the first rate cuts are pushed, the less confident people will be which could weigh on oil prices,” he said.

Data released Tuesday showed that U.S. consumer prices rose by a sharper-than-expected 0.3% in January and the rate of inflation remained stuck above 3%.

Natural gas

On Nymex, natural-gas prices looked to extend their plunge to a sixth session in a row, which would be the longest losing daily streak since the eight-session drop ended Oct. 20, 2023, according to Dow Jones Market Data.

Traders may have already written off this winter, and natural-gas heating demand, and are looking ahead to “shoulder season,” said Cieszynski. The shoulder months are the months after winter heating season and ahead of the summer cooling season.

U.S. natural-gas stocks in storage continue to stand well above the five-year average, according to the Energy Information Administration, which will issue its weekly update on domestic supplies Thursday.

Still, a “late winter storm, should one materialize, could shift sentiment rapidly,” said Cieszynski.

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