Crudeoil rallied up by 2.18% to settle at 6221 after a Malaysian airliner crashed over eastern Ukraine on the heels of fresh U. S. sanctions on Russia that had raised geopolitical concerns. Besides keeping a close watch on the developments in Ukraine and Iraq, traders will also be looking ahead to some key U. S. economic data, including a report on jobless claims.

On Wednesday, the U. S. government imposed tougher sanctions on some major Russian banks and energy firms including major oil producer Rosneft, condemning Russia for their continued support to separatists. Meanwhile, according to reports a Russian air force jet shot down a Ukrainian warplane on Wednesday night. Oil prices also saw support since Wednesday's supply data. The U. S. EIA said in its weekly report that U. S. crude oil inventories declined by 7.5mbls in the week ended July 11, far surpassing expectations for a decline of 2.1mbls. Total U. S. crude oil inventories stood at 375.0mbls as of last week.

The report also showed that total motor gasoline inventories increased by 0.2mbls, below forecasts for a gain of 0.6mbls, while distillate stockpiles rose by 2.5mbls, above expectations for an increase of 1.7mbls. Meanwhile Investors are also watching geopolitical tensions in the Middle East. Israel launched a Gaza ground campaign after 10 days of bombardments from the air and sea failed to stop Technically market is under short covering and getting support at 6131 and below same could see a test of 6041 level, And resistance is now likely to be seen at 6271, a move above could see prices testing 6321.

Trading Ideas:

Crudeoil trading range for the day is 6041-6321.

Crude oil jumped after a Malaysian airliner crashed over eastern Ukraine on the heels of fresh U. S. sanctions on Russia that had raised geopolitical concerns.

Iraq expects oil exports to reach 2.6 million bpd this month and has expanded the capacity of its export facilities in the south to 3 million bpd.

Libya will not be able to export oil through its two largest eastern ports before August, due to safety checks after a near year-long closure.