Light, sweet crude oil prices for July and August regained some earlier losses on the New York market June 6 to settle above $48/bbl while Brent crude contracts for August and September rallied to settle above $50/bbl.
Analysts and traders commented about ongoing tensions in the Middle East, but they appeared more focused on the weekly US government report about oil and product inventories. The US Energy Information Administration was scheduled to release that report on June 7.
Saudi Arabia, Egypt, the UAE, and Bahrain cut diplomatic relations with Qatar in a coordinated move on June 5, repeating long-held claims that Qatar supports militant groups. Qatar denies those accusations.
Ole Hansen, SaxoBank head of commodity strategy, said renewed tensions in the Middle East had limited influence over oil prices so far this week although prices have swung up and down upon the news.
“The Qatar spat once again highlights the subsurface simmering sectarian strife between major producers led by Saudi Arabia and backed by the US on one side and Iran backed by Russia on the other,” Hansen said.
Hansen foresees a possible negative influence on short-term oil prices but a longer-term boost to oil prices, assuming the conflict continues. Hansen said a risk premium to oil prices could be triggered by fear that oil supplies moving through the Middle East might be disrupted.
The July light, sweet crude contract on the New York Mercantile Exchange gained 79¢ to $48.19/bbl on June 5. The August contract rose 76¢ to close at $48.34/bbl.
The natural gas price for July climbed 6¢ to a rounded $3.04/MMbtu. The Henry Hub cash gas price was $2.96/MMbtu, up 5¢.
Heating oil for July edged up less than a penny to a rounded $1.47/gal. Reformulated gasoline stock for oxygenate blending for July climbed 1¢ to $1.55/gal.
The Brent crude contract for August on London’s ICE gained 65¢ to $50.12/bbl on June 6. The September contract increased 61¢ to $50.42/bbl. The June gas oil contract was $428.25/tonne on June 6, down $2.50.
The Organization of Petroleum Exporting Countries’ basket of crudes on June 6 was $46.97/bbl, down 40¢.
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