By Barani Krishnan

Investing.com — After days of choppy trade, crude prices jumped 3% on Thursday, their most in two weeks, as longs in the market bet on runaway fuel consumption ahead of Monday’s Memorial Day holiday that will flag off America’s peak driving season.

According to the American Automobile Association, 39 million Americans are anticipated to travel on Friday in advance of Thanksgiving. Record-high fuel prices will likely cause fewer trips to be made and less distance traveled this year.

New York-traded crude oil settled at $114.09/barrel, up $3.76 or 3.4%. It was WTI’s biggest one-day run-up since May 13, when it surged 4%. The U.S. crude benchmark suffered choppy trading in the four preceding sessions, which resulted a loss of 1.7%. 

London-traded crude oil for August delivery was settled at $117.40 per barrel. This is up 3.37 %.

“The latest round of U.S. data suggest the economy is decelerating but the consumer is still spending and probably will be traveling a lot this summer,” said Ed Moya, analyst at online trading platform OANDA. 

Data from Wednesday showing sharper-than-expected declines in U.S. crude and gasoline stockpiles helped put a floor beneath crude prices that slid as much as $2 a barrel in intraday trade over the past week. 

U.S. oil processing surpassed 93.2% capacity last week. This is the highest level since December 2019. Refiners have used all available fuel products in order to satisfy projected demand. The result has been record gasoline prices above $4.50 per gallon, and record diesel prices above $6.

Longs in the oil market also pounced on remarks by Germany’s economy minister Robert Habeck that the EU can still strike a deal on an oil embargo in the coming days or look to “other instruments” if no agreement is reached. 

Even though Hungary remains a major obstacle to EU sanctions, this was achieved despite Hungary still being a hurdle. Budapest seeks to raise about 750 million euro ($800 million), to improve its oil refineries and build a new pipeline linking Croatia with Russia.

China’s Premier Li Keqiang, meanwhile, delivered a downbeat outlook on Thursday about the new struggles with Covid faced by the world’s largest oil importer. According to analysts, sentiment may be affected by the China factor again in the week ahead.