DTN Oil Update
WTI Climbs Nearly 10% on Week Ahead Labor Day Holiday
HOUSTON (DTN) -- Oil futures closed mixed Friday in thin trading activity ahead of the U.S. Labor Day holiday amid a U.S.-Iran hostility escalation and the expectation of tightening global supplies.
Crude benchmarks edged up following U.S. airstrikes against Iranian targets and Tehran's retaliatory drone and missile counterfire against U.S. positions across the Gulf region.
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Physical energy flows through the Strait of Hormuz have plummeted from a 10-day average of 13 transits to one single-digit transit, according to vessel tracker data.
Limited U.S. inventories have also supported the bullish sentiment in the oil futures markets after the U.S. Energy Information Administration data recently showed commercial crude stocks fell 4.5 million bbl last week, marking the first inventory draw in five weeks. However, ULSD futures fell on the day despite the supply tightness caused by the Russian ban to exports and scarce domestic product due to intermittent attacks from Ukraine.
Market participants are now focused on the OPEC+ meeting scheduled on Sunday, Sept. 6, where the producer group is expected to leave October output policy unchanged after completing the scheduled unwinding of voluntary production cuts.
In U.S. economic data, non-farm payrolls surged by 162,000 in August, far exceeding market expectations of a 56,000 gain. The U.S. Bureau of Labor Statistics reported Friday, Sept. 4, that the national unemployment rate held steady at 4.1%.
NYMEX WTI crude for October delivery was little changed at $91.32 bbl, a nearly 10% weekly increase. ICE Brent for November edged up by $0.55 to $96.07 bbl, a 9% weekly gain.
NYMEX ULSD for October delivery eased $0.0506, or 1.10%, to $4.54305 gallon. Front month NYMEX RBOB rose $0.757 to $3.2106 gallon.
The U.S. Dollar Index gained 0.230 points to 99.11 against a basket of currencies.