Oil Price Rises Towards $59 On Tighter US Market, Middle East Tensions

Oil prices rose on Wednesday, lifted by a fall in US crude inventories and concerns that tensions in the Middle East could disrupt supplies.
Brent crude futures, the international benchmark for oil prices, were at $58.27 at 0131 GMT, up 39 cents, or 0.7 per cent from their last close – and a third above mid-year levels.
US West Texas Intermediate crude futures were at $52.08 per barrel, up 20 cents, or 0.4 per cent and almost a quarter above mid-June levels.
Traders said prices were pushed up by a drop in US crude inventories as well as concerns that fighting in Iraq and mounting tensions between the United States and Iran could affect supplies.
US crude inventories fell by 7.1 million barrels in the week to October 13 to 461.4 million barrels, the American Petroleum Institute said late on Tuesday.
Official US fuel inventory data is due to be published later on Wednesday by the Energy Information Administration.
Adding to a tightening US market, tensions in the Middle East meant that a risk premium was being priced into oil markets.
Iraqi government forces captured the major Kurdish-held oil city of Kirkuk earlier this week, responding to a Kurdish independence referendum, and there are concerns that fighting could disrupt supplies.
The Iraq crisis adds to a looming dispute between the United States and Iran.
Last Friday, US President Donald Trump refused to certify Iran’s compliance over a nuclear deal, leaving Congress 60 days to decide further action against Tehran.
During the previous round of sanctions against Iran, some one million bpd of oil was cut from global markets.
Reuters/NAN.