DTN Oil Update
Oil Prices Steady After Swinging on Iran Deal Talk
SECAUCUS, N.J. (DTN) -- Oil prices settled little changed after a volatile session Thursday amid reports that U.S. and Iranian negotiators were closing in on a deal to extend their ceasefire and reopen the Strait of Hormuz that is critical to energy shipping.
An across-the-board decline last week in U.S. crude and product inventories provided some support to energy markets in the absence of U.S. President Donald Trump's approval for the Iran deal. In Tehran as well, the leadership said it had not finalized details discussed by its negotiators in talks held with U.S. officials in Qatar.
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Thursday's reported deal could mark a major breakthrough toward formally ending the U.S.-Israeli bombings of Iran that began on Feb. 28. Those initial strikes triggered retaliatory attacks by Tehran on regional energy infrastructure and a blockade of the crucial Strait of Hormuz waterway. The strategic transit point handles a fifth of global energy shipments.
While an early April ceasefire has loosely held, analysts warn intense negotiations remain ahead over Iran's nuclear program, especially after President Trump dismissed an Iranian peace draft as a total fabrication.
After hitting a session high at $92.52 bbl, NYMEX WTI for July delivery turned volatile by mid-morning, hitting an intraday low of $87.11. It settled up $0.22 at $88.90 bbl.
ICE Brent for July delivery moved between $98.20 and $92.60 before settling at $93.71 bbl, down $0.58.
Downstream, NYMEX ULSD futures for June delivery advanced $0.0212 to close at $3.6187 gallon. June RBOB rose 0.0515 to finish at $ 3.1852 gallon.
The U.S. Dollar Index slipped by 0.194 points to 98.955 against a basket of foreign currencies by 3 p.m. EDT.
U.S. commercial crude inventories declined for a fifth consecutive week, while distillate stocks plunged to their lowest level since 2003, according to Energy Information Administration data for the week ended May 22. Commercial crude stockpiles fell by 3.3 million bbl to 441.7 million bbl, while gasoline inventories dropped to a fresh six-month low, falling by 2.6 million bbl to 211.6 million bbl.