CALGARY and LONDON: Oil prices ticked slightly higher on Friday but were little changed for the week as traders held on to hopes for a successful outcome from attempts to secure peace between the U.S. and Iran. Brent futures were up 25 cents, or 0.35%, at $72.05 a barrel by 10:50 a.m. ET. West Texas Intermediate was up 1 cent, or 0.01%, at $68.70 a barrel. U.S. markets were closed ahead of the U.S. Independence Day holiday on Saturday. On Thursday, the two oil benchmarks hit their lowest levels since before the U.S.-Israeli war on Iran began in late February. News Agency
Investor hopes for a full reopening of the Strait of Hormuz are being buoyed by peace talks between the U.S. and Iran, Commerzbank analysts said.
“The U.S.-Iran dealmaking process remains fragile but continues for now, as the question of Strait of Hormuz tolls and administration remains contentious,” Citi analysts wrote on Friday.
“We expect the MoU (memorandum of understanding) to hold, not because trust has suddenly emerged, but because the incentives to break are poor for both sides,” Citi analysts said.
Some shipping has resumed through the Strait of Hormuz, as called for under the initial U.S.-Iranian deal, but uncertainty is high after the two countries exchanged strikes last weekend following an Iranian attack on a cargo ship.
With the prospect of being able to ship more oil, Gulf producers are working to increase output.
Kuwait’s oil production rose sharply to 1.65 million barrels per day in June, from 580,000 bpd in May, a source close to the matter told Reuters on Thursday.
