NYMEX WTI Settles at 41-Month High

OLD BRIDGE, N.J. (DTN) -- New York Mercantile Exchange West Texas Intermediate crude oil futures and Brent crude oil on the Intercontinental Exchange continued higher Monday as participants await a decision on whether or not the United States will opt out of the 2015 Iranian nuclear accord.

Fox News has reported US President Donald Trump plans to announce a decision by 2 p.m. Tuesday, which could potentially reduce Iranian oil exports by as much as 1 million bpd.

No decision was forthcoming at market close as to whether today's meeting between U.S. Vice President Mike Pence and British Foreign Secretary Boris Johnson had convinced the U.S. to stay in the 2015 accord.

Ahead of the meetings with Secretary of State Mike Pompeo, Vice President Pence and National Security Adviser John Bolton, Johnson said it would be "better to fix flaws in the deal than to walk away from it."

Britain is the third European power to lobby the White House in favor of saving the agreement, after Germany's Angela Merkel and French President Emmanuel Macron also tried to make the case.

At 2:30 pm EDT, NYMEX June West Texas Intermediate futures settled $1.01 higher to $70.73 bbl, a new 41-month high on the spot continuation chart. ICE Brent crude for July delivery rose $1.30 to $76.17 bbl settlement.

NYMEX June RBOB futures settled up 2.0cts at $2.1340 gallon while the June ULSD contract rose 3.10cts to $2.1850 gallon settlement.

Phil Flynn, senior market analyst for the Price Futures Group in Chicago, said in a daily emailed newsletter the global energy market is sensitive to any shortages because the big surplus that dragged oil prices below $30 per barrel a little more than two years ago has been drained in part by a decision from the Organization of Petroleum Exporting Countries to limit production.

"The breakout to $70 a barrel (WTI) is not a fluke," Flynn said.

Brian Whary can be reached at brian.whary@dtn.com