Brent Oil Back Above $105.50 on Potential Supply Shock

Crude oil climbed on Thursday, rebounding from the lowest prices in months as the security situation in northern Iraq deteriorated, raising concerns of supply disruptions.

Brent and U.S. crude contracts rallied, after reports that U.S. President Barack Obama was considering airstrikes on Islamic militants in OPEC’s No. 2 oil producer. Earlier, two car bombs killed nine people in the Kurdish-held Iraqi oil city of Kirkuk, police and medical sources said.

“Obama’s statements helped move the markets, but we need to see that actually happen before oil prices can go up higher,” said Gene McGillian an analyst at Tradition Energy in Stamford, Connecticut. He said ample global supplies were still pressuring oil prices, and noted there were no disruptions in Iraq yet.

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