Onome Amuge

Oil prices rose on Thursday, extending gains from the previous session, as renewed tensions between Russia and Ukraine rekindled geopolitical risk in energy markets and US inventory data pointed to firm demand.

Brent crude, the international benchmark, gained 85 cents, or 1.3 per cent, to $67.69 a barrel, having earlier touched a two-week high. West Texas Intermediate, the US marker, added 86 cents, or 1.4 per cent, to $63.57. Both contracts had risen more than 1 per cent in the prior session.

The move came after Moscow and Kyiv accused each other of stalling peace talks. Russia launched air strikes near Ukraine’s border with the European Union, while Ukraine claimed to have hit a Russian oil refinery. The flare-up followed a two-week sell-off in crude markets, driven by hopes that US diplomatic efforts could ease the conflict.

“Some geopolitical risk premium is slowly being pumped back into the market,” consultancy Ritterbusch and Associates told clients. Tamas Varga, analyst at PVM Oil Associates, said the breakdown in peace efforts raised the likelihood of tighter sanctions on Russia, adding further uncertainty.

Prices also drew support from US inventory figures showing a bigger-than-expected fall in crude stockpiles. The Energy Information Administration reported a draw of 6mn barrels in the week to August 15, compared with analysts’ expectations of 1.8mn. The data signalled resilient demand in the world’s largest oil-consuming nation.

“These tight domestic stockpiles stand in contrast to the oversupply outlook projected by both the IEA and EIA for 2026, challenging traders’ broader market expectations,” said Alex Hodes, analyst at StoneX.

Investors were also awaiting signals from the Federal Reserve’s annual Jackson Hole symposium, which began on Thursday in Wyoming. Fed chair Jay Powell is scheduled to speak on Friday, with markets watching closely for indications of a potential interest rate cut next month.