Oil Rises on Iran Supply Concerns

Oil Rises on Iran Supply Concerns

Oil prices rose on June 27 after US officials ramped up pressure on its allies to end imports of Iranian crude by November, Reuters reported.

Brent crude futures reached $76.61 per barrel at 08:00 GMT, 30 cents higher than their last close, while West Texas International (WTI) futures rose 25 cents to $70.78 per barrel.

The movements are partly due to an announcement by a US state department official on June 26 who threatened to place sanctions on any country that does not halt all imports of Iranian crude by November 4, the Wall Street Journal reported.

“Oil prices were flying higher overnight after catching an updraft from the U.S. administration calling for allies to cut Iran imports to zero tolerance,” Stephen Innes, head of trading for Asia-Pacific at futures brokerage OANDA, told Reuters.

Other factors behind the rising prices include a supply disruption at Canadian oil company Syncrude and continuing uncertainty about the future of Libya exports.

Syncrude Canada is currently operating at a 350,000 barrel per day (b/d) deficit after a transformer blew and shut down a critical oil sands upgrader in June 2. Repairs are expected to last until the end of July.

Libyan supply remains uncertain due to the effects of the ongoing power struggle between the government and rebel forces. However, as of June 26, the ports of Hariga and Zueitina appeared to be operating normally.

Innes told Reuters that “Libya will continue to be a significant point of concern in the oil supply chain.”

 

 

 

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Sarah Samir 3751 Posts

Sarah has been writing in the oil and gas field for 8 years. She has a Bachelor Degree in English Literature. She has three years of experience in the banking sector.

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