Oil jumps over 5%
\n dubia
\nOil prices jumped more than 5% on Wednesday, hitting a two-week high after US President Donald Trump said the \u200cmemorandum of understanding to end the conflict with Iran was \u201cover\u201d, renewing fears of disruptions to Middle East oil supplies.
\nBrent crude futures gained $3.82, or 5.15%, hitting $77.98 a barrel at 0832 GMT, while US West Texas Intermediate crude climbed $3.70, or 5.25%, to $74.14 a barrel. The benchmarks are at their highest levels since June 23.
\nBoth benchmarks rose about 3% on Tuesday after the US revoked the general licence authorising the sale of Iranian crude following the Iranian attacks.
\n\u201cWhile the revocation doesn\u2019t fundamentally change oil market dynamics, it\u2019s important from a sentiment perspective. It heightens the risk of a breakdown in the temporary deal between the US and Iran,\u201d ING commodity strategists said on Wednesday.
\nThe US airstrikes were in response to Iranian attacks on three commercial vessels that were transiting the Strait of Hormuz, US Central Command said on Tuesday.
\n\u201cThe current conflagration is a reminder to the market of how fragile passage through the Strait still is,\u201d said Saul Kavonic, head of research at MST Marquee.
\n\u201cThis presents a contrary indicator to the prevailing sentiment that the market could be flooded into oversupply, which may scare some of the record short positioning to cover,\u201d he said, adding that if tensions persist and traffic through the waterway remains below 50% of pre-war levels, the resulting supply constraints could support higher oil prices.
\nAfter the US and Iran signed their truce agreement last month, oil prices tumbled back to pre-war levels and traders amassed large short positions in oil futures, or bets that \u200cprices \u2060would fall further.
\nExpectations of a wave of pent-up Middle East supply coming onto the market caused the price declines. Iran did not take responsibility for the vessel attacks, but Qatar blamed Iran for them, including one on a Qatari liquefied natural gas tanker, which reported being struck by a drone that caused a fire in its engine room.
\nA Saudi-flagged crude oil tanker, believed to be the supertanker Wedyan, was also damaged off Oman, maritime security sources said. \u2060The cause was not immediately clear.
\nThe attacks renewed concerns about tanker traffic through the Strait of Hormuz, which carried cargoes equal to about one-fifth of global energy supply before the war began in February.
\nIran is asserting its control of the Strait and has ordered ships to use a route closer \u2060to its coast rather than one nearer to Oman, which also borders the waterway. The US insists the waterway must remain free to all as it was before the conflict started.
\nSince the war started, nations have drawn down their inventories to make up for the supply \u2060shortfall.
\nUS crude oil inventories fell again last week, market sources said on Tuesday, citing data from the American Petroleum Institute. Analysts polled by Reuters had expected crude stockpiles to decline by about 2.4 million barrels in the week ended July 3.<\/p>\n","protected":false},"excerpt":{"rendered":"
Oil jumps over 5% dubia Oil prices jumped more than 5% on Wednesday, hitting a two-week high after US President Donald Trump said the \u200cmemorandum of understanding to end the conflict with Iran was \u201cover\u201d, renewing fears of disruptions to Middle East oil supplies. Brent crude futures gained $3.82, or 5.15%, hitting $77.98 a barrel […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-555296","post","type-post","status-publish","format-standard","category-business"],"yoast_head":"\n