DTN Oil Update
Oil Prices Steady as Quick Iran Deal Seems Less Certain
VIENNA (DTN) -- Oil futures steadied Friday morning after comments by Iranian officials cast doubt on the alleged progress made in negotiations with the U.S. delegation in Oman. U.S. President Trump on Thursday hinted at a possible Iran nuclear deal, which would likely see the removal of some sanctions on Iranian oil trade and bring back several hundred thousand bpd in additional supply to the market, causing prices to drop.
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NYMEX-traded WTI for June delivery was down $1.50 bbl to trade near $61.65 bbl, and ICE Brent for July delivery fell $1.54 bbl to $64.55 bbl.
June RBOB gasoline futures softened by $0.0457 to $2.1243 gallon, while the front-month ULSD futures contract was down $0.0512 to $2.1549 gallon.
The U.S. Dollar Index softened by 0.333 points to 100.540.
Iranian Foreign Minister Araghchi denied reports of receiving a written proposal from the U.S. According to a report by Bloomberg, the minister saw "many opposing and contradictory positions" from the U.S. delegation. This stood in contrast to comments made by U.S. President Trump on Thursday in which he claimed the two parties were "getting close to maybe doing a deal" after the fourth round of nuclear talks in Oman.
The potential return of Iranian barrels added to oversupply woes caused by a global economic slowdown and OPEC+ opening the spigots. The International Energy Agency, in its most recent oil market report published Thursday, projected global oil demand to slow from 990,000 bpd in the first quarter to 650,000 bpd during the remainder of the year. At the same time, global supply is now expected to rise even faster given OPEC's commitment to rolling back output curbs. The forecasted growth in global supply this year, now at 1.6 million bpd, is more than twice the anticipated demand growth rate of 740,000 bpd.