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Business Times
8 hours ago
- Business
- Business Times
Oil steadies after report of planned Opec+ August output hike
[HOUSTON] Oil prices edged up slightly on Friday (Jun 27), recovering from a midday drop into negative territory following a report that Opec+ was planning to hike production in August, but tumbled about 12 per cent in the week in their biggest drop since March 2023. Brent crude futures settled at US$67.77 a barrel, up four cents or 0.1 per cent. US West Texas Intermediate crude finished up 28 cents or 0.4 per cent at US$65.52 a barrel. Four delegates from Opec+, which includes allies of the Organization of the Petroleum Exporting Countries, said the group was set to boost production by 411,000 barrels per day in August, following a similar-size output increase already planned for July. 'The report about an Opec increase came out and prices cratered,' said Phil Flynn, senior market analyst with Price Futures Group, about the midday slide. Crude prices were already headed for a 12 per cent decline for the week following the ceasefire between Israel and Iran. During the 12-day war that started after Israel targeted Iran's nuclear facilities on Jun 13, Brent prices rose briefly to above US$80 a barrel before slumping to US$67 a barrel after US President Donald Trump announced an Iran-Israel ceasefire. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'The market has almost entirely shrugged off the geopolitical risk premiums from almost a week ago as we return to a fundamentals-driven market,' said Rystad analyst Janiv Shah. Flynn said expectations of higher demand in the coming months gave crude a boost earlier on Friday. 'We're getting a demand premium on oil,' Flynn said. Prices had also been supported earlier in Friday's session by multiple oil inventory reports that showed strong draws in middle distillates, said Tamas Varga, a PVM Oil Associates analyst. US government data on Wednesday showed crude oil and fuel inventories fell last week, with refining activity and demand rising. Meanwhile, data on Thursday showed that independently held gasoil stocks at the Amsterdam-Rotterdam-Antwerp refining and storage hub fell to their lowest in over a year, while Singapore's middle distillates inventories declined as net exports climbed week on week. Additionally, China's Iranian oil imports surged in June as shipments accelerated before the Israel-Iran conflict and demand from independent refineries improved, analysts said. China is the world's top oil importer and biggest buyer of Iranian crude. It bought more than 1.8 million barrels per day of Iranian crude from Jun 1 to 20, according to ship-tracker Vortexa, a record high based on the firm's data. The US oil and natural gas rig count, an early indicator of future output, fell for a fourth straight month to its lowest since October 2021, Baker Hughes said. The number of oil rigs fell by six to 432 this week, also the lowest level since October 2021. REUTERS
Qatar Tribune
4 days ago
- Business
- Qatar Tribune
Iranian closure of Hormuz Strait could rattle global energy markets
Agencies Apotential closure of Strait of Hormuz, a vital trade route that lies between Iran and Oman and accounts for roughly a fifth of global oil supply could rattle global energy markets, sending the price of commodity likely much higher than current level of around $77. The latest attacks by the U.S. on the nuclear sites in Iran sparked fears of Iran closing the strait, where around 30% of the global crude oil and 20% of the liquefied natural gas (LNG) are transported. In response, oil prices jumped on Monday, reaching their highest since January as the United States' weekend move to join Israel in attacking Iran stoked supply concerns. Brent crude futures were up 72 cents or 0.93% to $77.73 a barrel as of 8:06 a.m. GMT. U.S. West Texas Intermediate (WTI) crude advanced 71 cents or 0.96% to $74.55. On the other hand, the dollar strengthened, and Asian markets, which open ahead of European and U.S. markets, mostly fell – although Chinese stocks were higher – as traders wait to see how Tehran could respond. One option is to potentially create economic havoc by seeking to close the strategic Strait of Hormuz, which carries one-fifth of global oil output. Iran is the world's ninth-biggest oil-producing country, with an output of about 3.3 million barrels per day (bpd). It exports just under half of that amount and consumes the rest. It is also one of the five founding members of the Organization of the Petroleum Exporting Countries (OPEC). An Iranian closure of the Strait of Hormuz would be dangerous and 'not good for anybody,' the European Union's top diplomat, Kaja Kallas, said on Monday. 'The concerns of retaliation and this war escalating are huge, especially the closing of the Strait of Hormuz by Iran is something that would be extremely dangerous and not good for anybody,' Kallas told reporters ahead of a meeting with EU foreign ministers. Iran's Press TV reported on Sunday that Iran's Supreme National Security Council needed to make a final decision on whether to close the strait, after parliament was reported to back the measure. Although Iran vowed to defend itself, many analysts find it unlikely that Iran would retaliate by closing the narrow Hormuz Strait. The strait is situated between Oman and Iran and links the Gulf of Oman to the north, the Gulf of Oman to the south, and the Arabian Sea beyond. 'So far, satellite images reportedly suggest that oil continues to flow through the Strait, which may explain the muted market reaction to the news,' said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. 'Many remain optimistic that Iran will avoid a full-blown retaliation and regional chaos, to prevent its own oil facilities from becoming targets and to avoid a widening conflict that could hurt China, its biggest oil customer.' But 'if things get uglier,' the price of U.S. crude could even spike beyond $100 per barrel, she said. WTI was trading around $75 per barrel on Monday. Closing off the waterway would be technically difficult, but it could severely disrupt transit through it, sending insurance rates spiking and making shippers nervous about moving without U.S. Navy escorts. 'The situation remains highly fluid, and much hinges on whether Tehran opts for a restrained reaction or a more aggressive course of action,' Kristian Kerr, head of macro strategy at LPL Financial in Charlotte, North Carolina, said in a commentary. Iran may be reluctant to close down the waterway because it uses the strait to transport its own crude, mostly to China, and oil is a major revenue source for the regime. Speaking to Fox News on Sunday, U.S. Secretary of State Marco Rubio said disrupting traffic through the strait would be 'economic suicide' and would elicit a U.S. response. 'I would encourage the Chinese government in Beijing to call them about that because they heavily depend on the Strait of Hormuz for their oil,' Rubio said. Beijing on Monday said the international community must do more to prevent fighting between Iran and Israel from impacting the global economy, noting the 'Persian Gulf and surrounding waters are important international trade routes.' 'The Chinese side urges the parties to the conflict to prevent the situation from escalating repeatedly, resolutely avoid the spillover of war, and return to the path of political resolution,' foreign ministry spokesperson Guo Jiakun said. Tom Kloza, chief market analyst at Turner Mason & Co., said he expects Iranian leaders to refrain from drastic measures and oil futures to ease back after the initial fears subside. Disrupting shipping would be 'a scorched earth possibility, a Sherman-burning-Atlanta move,' Kloza said. Writing in a report, Ed Yardeni, a longtime analyst, agreed that Tehran leaders would likely hold back. 'They aren't crazy,' he wrote in a note to investors Sunday. Other experts weren't so sure. Andy Lipow, a Houston analyst who has covered oil markets for 45 years, said countries are not always rational actors, and he wouldn't be surprised if Tehran lashed out for political or emotional reasons. 'If the Strait of Hormuz were completely shut down, oil prices would rise to $120 to $130 a barrel,' said Lipow. That would translate to about $4.50 a gallon at the pump and hurt consumers in other ways, he said. 'It would mean higher prices for all those goods transported by truck, and it would be more difficult for the Fed to lower interest rates,' he added, pointing to the U.S. central bank, which last week kept rates on hold.
Scroll.in
5 days ago
- Business
- Scroll.in
Israel-Iran conflict top updates: Global oil prices surge to five-month high
Global oil prices surged to a five-month high on Monday amid escalating tensions in West Asia, following strikes by the United States and Israel on Iran's nuclear facilities, Reuters reported. The conflict escalated on Sunday when the US joined Israel's war on Iran. President Donald Trump said that the country carried out a 'very successful attack' on Iranian nuclear sites in Fordo, Natanz and Esfahan. The United States' decision to directly enter the conflict came more than a week after the Israeli military struck what it claimed were nuclear targets, and also other sites, in Iran with the aim of stalling Tehran's nuclear programme. Iran retaliated with missile attacks on Israel. Iran responded to the US strikes by threatening to expand its list of legitimate military targets. Here is more on this and other top updates: The benchmark Brent crude on Monday briefly touched the price of $81.4 per barrel and US West Texas Intermediate hit $78.4, before falling marginally, Reuters reported. The prices stabilised at a about 1% gain. The volatility reflected heightened concerns about the potential disruption of fuel supplies, particularly because of the possible blocking of the Strait of Hormuz chokepoint. Around one-fifth of the world's oil passes through the narrow strait. While no direct disruption to oil flows had taken place, the market was pricing in a possible Iranian retaliation, which could include targeting of oil tankers, Reuters quoted analysts as saying. Iran is the third-largest oil producer among the Organization of the Petroleum Exporting Countries. International Atomic Energy Agency chief Rafael Mariano Grossi said that Iran's underground nuclear facility at Fordo had likely suffered ' very significant damage ' following the US strikes that used bunker-buster bombs. 'At this time, no one, including the IAEA, is in a position to have fully assessed the underground damage at Fordo,' the chief of the United Nations nuclear watchdog said. The Israel Defense Forces said that it had carried out a second strike on the Fordo nuclear site earlier in the day, following the US attack on Sunday. The action was meant to 'obstruct access routes' to the site, the Israeli military said. Israel also carried out strikes on Iranian security command centres and targets in the capital city of Tehran, including the Evin prison, where political prisoners are believed to be held, BBC quoted Israeli Defence Minister Israel Katz as saying. Iran warned the US of a broader military response, with a senior Iranian official calling Trump a ' gambler ', Reuters reported. 'Mr Trump, the gambler, you may start this war, but we will be the ones to end it,' said Ebrahim Zolfaqari, the spokesperson for Iran's Khatam al-Anbiya central military headquarters. During talks in Moscow, Russian President Vladimir Putin told Iranian Foreign Minister Abbas Araghchi that the strikes on Iran were not justified
Egypt Independent
5 days ago
- Politics
- Egypt Independent
US asks China to inform Iran not to close the Strait of Hormuz
US Secretary of State Marco Rubio urged China on Sunday to encourage Iran not to close the Strait of Hormuz, following Washington's strikes on Iranian nuclear sites, Reuters reported. Rubio's comments came after the Iranian parliament approved the closure of the Strait of Hormuz, through which about 20 percent of global oil and gas flows. 'I encourage the Chinese government in Beijing to approach them (Iran) about this, because they rely heavily on the Strait of Hormuz for their oil,' said the US Secretary of State, who also serves as National Security Advisor. 'If they do that, it would be another grave mistake. It would be economic suicide for them. We still have options to deal with this situation, but other countries should consider it as well. It would hurt other countries' economies far more than ours,' the US Secretary of State said, adding that that 'closing the strait would be a massive escalation that would merit a response from the US and other countries.' A vital waterway The Strait of Hormuz is one of the world's most important waterways. The US Energy Information Administration describes it as 'the world's most important oil transit route.' Located between the Sultanate of Oman and Iran, it connects the Gulf to the Gulf of Oman and the Arabian Sea. It is the primary export route for oil producers such as Saudi Arabia, the United Arab Emirates, Iraq, and Kuwait. Large amounts of crude oil extracted from the oil fields for states belonging to the Organization of the Petroleum Exporting Countries – such as Saudi Arabia, the United Arab Emirates, Kuwait, and Iraq – pass through the Strait of Hormuz to meet global demand.
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Business Standard
20-06-2025
- Business
- Business Standard
No OPEC+ action needed amid Iran-Israel conflict, says Putin on oil market
Russian President Vladimir Putin said on Friday that oil prices had not risen significantly due to the conflict between Iran and Israel, and that there was no need for the OPEC+ group of oil producers to intervene in oil markets. Oil prices have rallied as a week-old air war between Israel and Iran escalated and uncertainty about potential US involvement kept investors on edge, with Brent crude futures touching their highest since late January. Putin said the price of oil now stands at around $75 per barrel, while before the conflict escalated it stood at $65. "Of course, we see that the current situation in the Middle East, the current situation related to the conflict between Iran and Israel, has led to a certain increase in prices. But this increase, in the opinion of our experts, is not significant," Putin told the St Petersburg Economic Forum. Iran is the third largest producer among members of the Organization of the Petroleum Exporting Countries. Hostilities could disrupt its supply of oil and thereby increase prices. Putin also said OPEC and allies including Russia - a group known as OPEC+, which pumps about half of the world's oil - were increasing oil output, but doing so gradually, to ensure balance in the oil market and "comfortable" prices. "We will all see together how the situation unfolds. So far no immediate response is required," he said.
