Falling US stockpiles, worsening Iran tensions propel crude oil prices

Crude oil prices gained ground on the commodity market today, rising above the $99 per barrel mark, as stockpiles of the fuel in the US dropped significantly.

WTI crude oil futures for March rose $0.90 to settle at $99.31 per barrel on the NYMEX. The American benchmark rose more than $1 during yesterday’s session.

On the London-based ICE Futures Exchange, Brent crude oil prices for settlement in March gained 42 cents at $116.65 per barrel.

Inventories of both crude oil and gasoline in the US dropped dramatically over the past 24 hours, when a Canadian oil sands plant reported a sudden outage, bolstering immediate demand for the fuel and causing a strong upward shift on the crude oil price chart.

Analysts have stated that the upturn is not an indication of a permanent rise in demand, but rather a mere reaction to weather conditions, and therefore should not be counted on as a long-term fix for the situation.

WTI crude oil prices have been circling the resistant $100 per barrel mark for the past several months, as traders debated whether the continually improving economic situation on the home front could offset the slowed growth in Europe.

Investors are keeping a keen eye on the escalating tensions between the powers of the West and Iran. The OPEC nation is the third largest crude exported in the world, and has long since been the main source of the fuel for the bulk of Europe’s larger nations. With the EU announcing an upcoming embargo against Iranian oil in order to force the nation into abandoning its nuclear plans, the demand for crude oil on the continent is expected to surge strongly in the near future.

At the center of global attention today was also Greece and its bailout package negotiations. The debt-riddled nation now looks to be headed towards a compromise concerning the austerity measures comprising the package.