Oil crept up on Thursday amid ongoing tensions over the death of a prominent Saudi journalist, with prices steadying after a big drop overnight due to a jump in US crude stockpiles.

US West Texas Intermediate crude for October delivery was higher 12 cents, or 0.2 percent, $69.87 per barrel, after falling 3 percent in the previous session to settle below $70 for the first time in a month.

Front-month London Brent crude for delivery in December was higher 13 cents, or 0.2 percent, at $80.18, having ended down 1.7 percent.

US crude stocks gained 6.5 million barrels last week, the US Energy Information Administration said on Wednesday, the fourth straight weekly build and almost three times what the analysts had forecast.

“The impact of the inventor y-jump weighed on the market and oil seems bearish,” stated Kaname Gokon, who is a trader in Japan. “The United States may have to go ahead with sanctions on Saudi Arabia, which could push prices higher, but Russia and other producers are set to increases supplies.”

Inventories increased steeply even as US crude production slid 300,000 barrels per day to 10.9 million barrels per day last week due to the effects of offshore facilities closing temporarily for Hurricane Michael.

US lawmakers blamed the Saudi leadership over the disappearance of prominent Saudi critic and journalist Jamal Khashoggi, indicating that sanctions could be possible.

Saudi Arabia is denying that it played any role in Khashoggi’s disappearance.

Western pressure mounted on Riyadh to provide answers, but comments by President Donald Trump suggested that White House may not take additional actions against the Saudis, specifically after Saudi Arabia said it will conduct a probe.

Investors worry Saudi Arabia could use oil supply to retaliate against critics. However, Saudi Arabia has assured the Organization of Petroleum Exporting Countries that is “committed, capable, and willing” to ensure there will be no shortage in the oil market, OPEC’s secretary-general said on Wednesday.

Saudi Arabia and Kuwait will flounder to resume oil production from jointly operated fields that produced some 500,000 barrels per day any time soon due to operational differences and increasingly sour political ties, according to sources.

Signs that Iranian oil exports have been decreasing more sharply than some in the market expected, amid looming US sanctions have underpinned the oil market.


Meanwhile, gold prices dropped while the dollar gained on Thursday after the minutes of the latest Federal Open Market Committee meeting, which reinforced expectations of a tighter US monetary policy.

Gold futures for delivery in December on the Comex division of the New York Mercantile Exchange slid 0.08 percent at $1,226.4 a troy ounce.

“Gold is closely tracking both the US dollar and equities, more so the dollar,” said Peter Fung, who is the head of dealing at Wing Fung Precious Metals in Hong Kong.

The US dollar index that tracks the US dollar against a basket of the other currencies edged up 0.06 percent to 95.41 on Thursday and reached a fresh one-week high. “The USD has been making up some lost grounds in the past 24 hours or so. It seems to have been more market related rather than US data (only housing starts were released overnight and they were likely hurricane affected), while the FOMC Minutes this morning also have not shifted the dial too much,” said David de Garis, who is a director and senior economist at National Australia Bank, in a morning note.

Latest geopolitical events and macroeconomic factors including the US-China trade dispute worries and tensions over the disappearance of a prominent Saudi journalist were cited as tailwind for the precious metal earlier this month.

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