• WTI up nearly 2%, driven by robust US economy and Middle East tensions.
• Red Sea disruptions, including Maersk ship incidents and Russian refinery drone attack, heighten oil supply worries.
• US crude stockpile declines due to severe weather and positive Chinese economic recovery signs bolster oil prices.

West Texas Intermediate (WTI), the US crude oil benchmark, rose almost 2% on Thursday following the latest release of Gross Domestic Product (GDP) figures in the United States (US). Geopolitical tensions in the Middle East sponsored the so-called “black gold” leg up, and at the time of writing, Oil trades at $76.82 per barrel after bouncing off a daily low of $75.19.

Oil prices bolstered by Middle East tensions and US stockpile drawdowns

Tensions in the Middle East are causing disruptions in global trade. The recent incident involving Maersk ships that were carrying US military equipment refrained from training into the Red Sea after hearing explosions that forced two ships to retreat despite being escorted by the US Navy.

Meanwhile, sources cited by Reuters commented that energy markets are beginning to reflect supply chain disruptions, linked to the Red Sea conflict. This could underpin Oil prices, which rose for the aforementioned reasons, along with a drone attack on a Russian Oil refinery.

In the meantime, a larger-than-expected draw in crude stockpiles in the US due to extreme cold weather was a tailwind for WTI prices

Meanwhile, expectations that China’s economy is recovering were cheered by Oil bulls following the People’s Bank of China (PBoC) decision to reduce bank reserves on Wednesday.