Futures Movers: Oil climbs further, supported by fresh Middle East tensions

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Oil futures climbed to fresh 3 1/2-year highs on Thursday following, military action in Syria and the Arabian peninsula involving Iran or forces backed by the country.

June West Texas Intermediate crude oil CLM8, +0.70% rose 50 cents, or 0.7%, to $71.64 a barrel. On Wednesday, the contract rallied $2.08, or 3%, to settle at $71.14 — the highest for a front-month contract November 2014. The day’s percentage gain was the largest such rise since April 10, according to FactSet data.

International benchmark July Brent crude LCON8, +0.67% was up 58 cents, or 0.8%, to $77.78 a barrel. The contract climbed $2.36, or nearly 3.2%, to $77.21 a barrel on Wednesday, also ending at a level last seen in November 2014.

Fresh highs for oil came as Israel’s military carried out strikes against Iranian targets in Syria after it said Iranian forces based there fired rockets at its soldiers in the Golan Heights. Separately, Iran-backed Houthi rebels in Yemen fired a barrage of missiles into Saudi Arabia on Wednesday.

Worries about Iran, including its nuclear deal with major world powers, have been key to oil’s recent rally to late-2014 levels. Prices have swung wildly in recent days as investors anticipated U.S. President Donald Trump’s decision to pull out of the 2015 nuclear deal and reimpose “the highest level of economic sanctions” against the country.

Fresh sanctions on the Middle Eastern nation could curb its oil exports and lead to a tighter global oil supply.

Read: Risk of war between Iran and Israel has risen markedly after Trump’s decision to scrap nuclear deal

Helping fuel the rebound in oil prices, the U.S. Energy Information Administration reported Wednesday that crude supplies fell by 2.2 million barrels for the week ended May 4, following back-to-back weekly increases. Analysts surveyed by S&P Global Platts had forecast a decline of 400,000 barrels, while the American Petroleum Institute on Tuesday reported fall of nearly 1.9 million barrels, according to sources.

Gasoline stockpiles also declined by 2.2 million barrels for the week, while distillate stockpiles dropped 3.8 million barrels, according to the EIA. The S&P Global Platts survey forecast supply declines 600,000 barrels for gasoline and 1.9 million barrels for distillates stockpiles.

Read: Oil and the dollar are doing something they have only done 11 times in the past 35 years

On Nymex, June gasoline RBM8, +0.38% rose 0.4% to $2.176 a gallon, after closing up 2.7% to $2.167 a gallon on Wednesday, the highest finish since October 2014. June heating oil HOM8, +0.41% rose 0.4% to $2.227 a gallon. The contract closed up 2.8% to $2.218 a gallon on Wednesday, notching its highest settlement since February 2015.

June natural gas NGM18, -0.37%  fell 0.4% to $2.726 per million British thermal units.

— Myra P. Saefong contributed to this article