Oil prices edged up on November 20, 2024, as the ongoing conflict in Ukraine escalated and indications of increasing Chinese crude imports emerged. Brent crude futures rose by 9 cents, or 0.1%, reaching $73.40 a barrel, while U.S. West Texas Intermediate crude futures increased by 14 cents, or 0.2%, to $69.53 per barrel. This uptick in oil prices comes despite a reported rise in U.S. crude oil stocks, which increased by 4.75 million barrels for the week ending November 15, according to the American Petroleum Institute. However, gasoline inventories fell by 2.48 million barrels, and distillate stocks decreased by 688,000 barrels, indicating mixed signals in the market.

The intensifying war between Russia and Ukraine has contributed to the upward pressure on oil prices. Recently, Ukraine utilized U.S. ATACMS long-range missiles to strike Russian territory, marking a significant escalation in the conflict. This development has raised concerns about potential supply disruptions in the oil market, as noted by analysts from ANZ. Furthermore, Russian President Vladimir Putin has lowered the threshold for a possible nuclear strike, further heightening tensions.

On the other hand, signs of recovering demand from China, the world's largest crude importer, have also supported oil prices. Data from vessel tracker Kpler suggests that China's crude imports are on track to reach record highs by the end of November, following a period of weak imports earlier this year. This resurgence in demand is crucial, especially as Brent crude prices have fallen by 20% from their April peak of over $92 a barrel.

As the market awaits official government data later today, the interplay between geopolitical tensions and demand dynamics continues to shape the oil landscape.