Brent Steady Between Over-Supply And Geopolitical Tension

Brent crude oil remained near $107 as rising global supplies helped mitigate worries about geopolitical tensions. The commodity traded at $107.28 at 7:15 GMT despite ongoing conflicts in the Middle East and Africa.

The death toll in Gaza continued to climb this week despite efforts to broker a cease fire agreement. On Thursday, news reports that a school had been bombed leaving 15 people dead served as a stark reminder that the more than 750 people killed so far in the conflict have mostly been civilians.

Meanwhile European policy makers continued to struggle with enacting tougher sanctions on Moscow without landing any major blows to their own economies. The E.U. is considering sanctions specifically targeting Russian banks, something that would escalate the tension between Moscow and the West as they would be the most serious sanctions to date.

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Reuters reported that analysts are puzzled by the lack of impact the fighting in Ukraine and Gaza is having on crude prices, but most believe that it’s the result of an over-supplied market. Oversupply may increase further; oil production in Libya has nearly doubled after months of being depressed due to protests, but the nation’s Brega oil port remains blockaded by protesters.

Oil prices found further support from U.S. economic data which showed that the nation’s initial jobless claims were at an eight and a half year low last week. The Labor Department data showed new claims for jobless benefits in the U.S. had fallen by 19,000 to 284,000.