Shafaq News
Oil prices climbed on Wednesday, moving away from aseven-week low touched in the previous session, after the U.S. militarylaunched new strikes against Iran and as market data showed another large drawin U.S. crude stocks.
Brent futures rose 66 cents, or 0.7%, to $92.11 a barrel at0406 GMT, while U.S. West Texas Intermediate crude crude climbed 60 cents, or0.7%, to $88.80.
The U.S. military struck Iranian targets after PresidentDonald Trump vowed on Tuesday to respond to the downing of a U.S. Apache attackhelicopter, a fresh escalation thatthreatens to unravel a fragile ceasefire between Washington and Tehran.
The latest attacks shifted traders' focus back toward warrisks and potential supply disruptions, said Priyanka Sachdeva, senior marketanalyst at Phillip Nova.
"While diplomatic efforts remain ongoing, the latestmilitary exchanges have reintroduced a geopolitical risk premium into oilmarkets," Sachdeva said.
Tehran said it would resume hostilities if Israel continuedto attack the Hezbollah militia in Lebanon. Israel's refusal to end itscampaign against Iran-backed Hezbollah has hindered Trump's efforts to extend atenuous ceasefire in the wider U.S.-Israeli war with Iran into a durablesettlement.
"With no imminent deal in sight and with the global oilmarket tightening significantly every day, we see upside to prices,particularly if these disruptionslinger into the third quarter, a period of seasonally stronger oildemand," ING commodity strategists said in a note on Wednesday.
At the same time, Tehran has continued to block mostshipping through the Strait of Hormuz, which normally carries a fifth of theworld's crude oil and liquefied natural gas. Washington has imposed its ownblockade of Iranian ports.
U.S. Energy Secretary said on Tuesdaythat ship traffic in the Gulf and oil exports through the Strait of Hormuz arerising even as Washington and Tehran struggle to reach a deal on ending theirmore than three-month-old war.
Meanwhile, U.S. crude oil inventories fell last week for aneighth consecutive week,according to market sources citing data from the American Petroleum Institutereleased on Tuesday, while gasoline stocks also declined.
Crude stocks fell by 9.12 million barrels in the week endedJune 5, the sources said on condition of anonymity,while gasoline inventories fell by 1.19 million barrels.
The United States has acted as a marginal supplier of crudeand products during the war and ramped up exports to Asia and Europe. LowerU.S. inventories could hurt exports and push up prices.
(REUTERS)
Only the headline is edited by Shafaq News.
