Oil rises over 1% as Mideast tensions face virus concerns | Reuters

Oil rises over 1% as Mideast tensions face virus concerns | Reuters

Oil prices rose more than 1% on Thursday on increasing Middle East tensions, but gains were capped as fresh restrictions to counter a surge in COVID-19 cases threatened the global energy demand recovery.

Brent crude oil futures rose 91 cents, or 1.3%, to settle at $71.29 a barrel, after earlier dipping below $70 for the first time since July 21. U.S. West Texas Intermediate (WTI) crude futures rose 94 cents, or 1.4%, to settle at $69.09 a barrel.

Both benchmarks fell more than $2 on Wednesday to a two-week low.

"Yesterday it was really all about concerns about the Delta variant, and then today there were worries that maybe we overdid it," said Phil Flynn, senior analyst at Price Futures Group in Chicago. "We saw an increase in geopolitical risk as well."

Israeli jets struck what its military said were rocket launch sites in Lebanon early on Thursday in response to two rockets fired towards Israel from Lebanese territory, in an escalation of cross-border hostilities amid heightened tensions with Iran. read more