Brent oil near five-month high on Iran, WTI falls

 Resize text         Printer-friendly version of this article Printer-friendly version of this article

Brent crude oil rose to a near five-month high above $117 a barrel o n Thursday after Iran rejected calls for direct talks with the United States, while U.S. crude prices fell on concerns about growing domestic stockpiles in the Midwest.

Brent's premium over West Texas Intermediate (WTI) crude rose to more than $21 a barrel, the highest this year, after a report said a key refinery in the U.S. Midwest would remain shut for maintenance for longer than previously expected.

The delayed restart of a 260,000 barrel per day crude unit at BP's Whiting, Indiana, refinery will potentially add to the glut of oil at Cushing, Oklahoma, delivery point for the U.S. benchmark.

Brent finished 51 cents higher to settle at $117.24 a barrel, the highest close since mid-September.

U.S. crude dropped 79 cents to $95.83 a barrel. The Brent-WTI spread finished at $21.41 a barrel, the highest since mid-December.

Brent, the international benchmark, found support after Iran's supreme leader, Ayatollah Ali Khamenei, rejected an offer from U.S. Vice President Joe Biden to negotiate over Tehran's nuclear program, dimming prospects for a resolution of the dispute seen as a major risk factor for oil markets.

"The Brent market is a little more sensitive to geopolitical risk and tensions, and reports that the leader in Iran said he doesn't want to engage in direct talks with the United States, that ratcheted up a bit of the geopolitical risk," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.

Traders have been closely watching the stand off with Iran due to concerns about supplies from the OPEC nation.

Oil markets have taken additional support from signs that the economies of the United States and China, the world's two top oil consumers, are recovering at a quicker pace than before.

The Chinese economy ended seven straight quarters of slowing growth with a 7.9 percent lift in the fourth quarter, data showed on Wednesday.

The number of Americans filing new claims for jobless benefits fell last week and put the four-week average reading at a near five-year low, but other data showed a productivity drop in the fourth quarter due to weak economic output.

U.S. benchmark gasoline prices fell by 1 percent on Thursday to $2.9999 a gallon, the lowest level so far in February.

Colonial Pipeline, which operates the main pipeline carrying gasoline to the East Coast from the Gulf Coast refining hub, said Thursday it expects an additional 100,000 barrels-per-day of capacity to be available on its line to North Carolina by the second quarter. (Additional reporting by David Sheppard, Ron Bousso and Simon Falush in London, Ramya Venugopa in Singapore; Editing by David Goodman, Jane Baird, Bob Burgdorfer and Alden Bentley)



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


348 Square Baler

A faster plungerhead (93 strokes per minute) and a heavy-duty bale case with adjustable side doors makes this the ideal ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Leads to Insight