WASHINGTON, D.C. (DTN) -- New York Mercantile Exchange crude oil futures nearest to delivery and Intercontinental Exchange Brent edged higher in early morning trade, with NYMEX August RBOB slipping 1.15% after storm in the Gulf of Mexico weakened to a tropical depression, while rallying equities and continued geopolitical tensions in the Middle East capped the losses.
At just about 9 a.m. ET, August West Texas Intermediate crude futures traded up 20 cents at $60.41 per barrel (bbl) while the ICE Brent contract rose 27 cents to $66.99 bbl.
NYMEX August RBOB futures fell 3.24 cents to $1.9446 gallon and August ULSD futures declined 0.66 cents to $1.9735 gallon.
A mixed start to the trading week comes after Hurricane Barry was downgraded to a tropical depression on Sunday afternoon with at least one Gulf of Mexico refinery reported offline. Though roughly 73% of crude production in the region was reported shut-in on Sunday, market participants expect operators to quickly evaluate the status of offshore platforms and resume output. Still, the storm dropped as much as 25 inches of rain in some places in Louisiana, with prolonged power outages and heavy flooding affecting nearly one fifth of U.S. refining capacity located in the region.
Meanwhile, Baker Hughes reported on Friday the number of active oil rigs in the United States fell four on the week to a 784 17-months low, which follows a five-rig decline from June 28 to July 3. The U.S. oil rig count is down 79 against year ago, with operators deactivating 101 rigs year-to-date.
In the Middle East, Iranian President Hassan Rouhani said in a televised speech on Sunday that Iran is ready to hold talks with the U.S. if Washington lifts sanctions and returns to the 2015 nuclear deal. The White House responded that it is open to negotiations with Iran on a more far-reaching agreement on nuclear and security issues. According to Reuters, Tehran has made any talks conditional on first being able to resume its oil exports.
Organization of the Exporting Countries reported last week Iran's oil production plunged 142,000 barrels per day (bpd) last month to 2.225 million bpd -- the lowest level in more than three decades.
In financial markets, U.S. stock indexes point to moderate gains Monday morning after a record-breaking week and a sluggish economic data from China was released overnight. China's economic growth slowed to 6.2% in the second quarter -- the weakest pace in nearly 30 years, while industrial output and retail sales came in line with market expectations. Weak economic data from the world's second largest economy raised hopes that Beijing would unveil a stimulus package to fuel a slowing economy. Following the release of China's GDP figures U.S. President Trump tweeted "Thousands of companies are leaving. This is why China wants to make a deal."
Liubov Georges can be reached at email@example.com
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