DTN Oil Update
Oil Up 3rd Straight Day on Iran Heat, US Stockpile Drop
SECAUCUS, N.J. (DTN) -- Oil prices rose for a third consecutive day Wednesday as rising tensions in U.S.-Israeli relations and fresh hostilities in the Middle East delayed an end to the Iran war and reopening of the Strait of Hormuz to energy shipments.
Also underpinning the rally were U.S. crude stockpiles which hit a near four-month bottom last week even distillate and gasoline inventories rose from recent lows, according to the U.S. Energy Information Administration (EIA) data.
NYMEX WTI crude for July delivery settled up $2.26 at $96.02 bbl, rising 2.4% on the day to add to the prior two-day tally of 7%.
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ICE Brent crude for August delivery rose by $1.81 to close at $97.81 bbl, adding almost 2% to the prior 4% climb on Monday through Tuesday.
WTI and Brent prices advanced after the EIA said crude stocks fell for a sixth straight week, plunging 8 million bbl to 433.7 million bbl during the latest week ended May 29. That marked the lowest inventory level and the steepest single-week drawdown in U.S. crude since mid-February.
Downstream, NYMEX ULSD for July delivery edged higher by $0.1494 to settle at $ 3.8481 gallon.
ULSD pricing rose despite distillate fuel inventories rising by 1.5 million bbl to 102.3 million bbl during the week ended May 29, according to the EIA. ULSD prices have been on uptrend, picking up momentum after inventories hit 23-year lows in the week to May 22.
NYMEX RBOB for July slipped $0.0126 to close at $ 3.1316 gallon the EIA reported that gasoline inventories increased by 3.4 million bbl to 215 million bbl during the week ended May 29 after hitting near six-month lows the week prior.
On the forex market, the U.S. Dollar Index rose by 0.326 points to 99.51 against a basket of foreign currencies.
Tensions in U.S. and Israeli relations dominated media coverage of the war in Iran. U.S. President Donald Trump confirmed that he held a phone call with Israeli Prime Minister Benjamin Netanyahu to express his dismay with Israel's continued bombardment of Iranian ally, the Lebanese Hezbollah.
Iran has said it will negotiate any settlement with the U.S. unless the attacks on Lebanon stop. Lebanese media reported on Wednesday an Israeli drone strike just south of Beirut and also heavy bombardment across southern Lebanon that killed at least six people.
Kuwait also faced heat from Iran, which launched missiles at its southwestern neighbor, accusing it lending territory to U.S. forces attacking Iran. Kuwait denied the charge after some 30 missiles targeted at its airport that resulted in a death and various human injuries.