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Global crude oil futures edged higher on Thursday, 2 July, supported by short-covering activity ahead of the long US Independence Day weekend, as traders shifted their focus from geopolitical supply risks to the prospect of ample crude availability.

Brent crude settled at $71.80/barrel, up 23 cents or 0.32%.

WTI gained 11 cents, or 0.16%, to close at $68.69/bbl.

Despite the modest gains, both benchmarks remained near levels seen before the recent Middle East conflict, reflecting a market that has largely unwound the geopolitical risk premium built up during the height of regional tensions.

Market participants attributed the day's advance primarily to short-covering rather than fresh bullish sentiment, with traders reducing bearish positions ahead of the US holiday period.

"We're seeing a little short-covering here. The focus has shifted to how much supply are we going to see in the markets from how much supply are we going to lose," an industry expert said.

Reinforcing the easing supply outlook, crude flows through the Strait of Hormuz climbed to approximately 14 million barrels per day on 1 July, according to Bloomberg-compiled data. The increase comes on top of around 6.2 million barrels per day of exports shipped via alternative routes from Saudi Arabia's Red Sea coast and the UAE's Fujairah port, highlighting the resilience of regional export infrastructure despite lingering geopolitical uncertainties.

The recovery in export volumes has reassured market participants that physical supply remains largely uninterrupted, limiting the upside for crude prices even as traders continue to monitor developments in the Middle East and broader macroeconomic conditions.

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