After opening in positive territory, both Brent and WTI maintained their bullishness, tracking a net ascending path on continued geopolitical risk. Oil demand has temporarily weakened, owing to the ongoing seasonal maintenance in many US refineries. The threat of another weekly increase in US crude inventories was hence tangible and tempered the uptrend. A diplomatic row between Saudi Arabia and Iran and the risk of renewed US sanctions against the country has prompted sellers of medium sour grades to momentarily hold on to their Iranian crude supply. In the meantime, a weaker dollar was supportive of commodities. More support came from an unexpected 2.62m bbl draw in US crude inventories in afternoon trading. Persistent concerns over the diplomatic row between the US and Iran continued to feed further momentum into both Brent and WTI forward curves.
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