Market News

By Erwin Seba

Summary

• Brent and WTI benchmarks resume climb
• War risk continues to underpin market
• IEA global oil supply forecast revised upwards

HOUSTON, June 17 (Reuters) - Oil prices climbed over 3% on Tuesday as the Iran-Israel conflict raged with no end in sight, though major oil and gas infrastructure and flows have so far been spared from substantial impact.
Brent crude futures gained $2.76, or 3.77%, to $75.99 a barrel by 12:56 p.m. CDT (1756 GMT). U.S. West Texas Intermediate crude was up $2.50, or 3.48%, at $74.26.

While there was no noticeable interruption to oil flows, Iran partially suspended gas production at the South Pars field it shares with Qatar after an Israeli strike started a fire there on Saturday. Israel also hit the Shahran oil depot in Iran.

The continuing exchange of airstrikes between Israel and Iran returned geopolitical risk to oil markets already aware of a tight supply and demand balance, said Phil Flynn, senior analyst with the Price Futures Group.
"This is not a one-and-done; it's probably much more similar to Russia and Ukraine," Flynn said.
A collision of two oil tankers near the Strait of Hormuz, where electronic interference has increased during the conflict, highlighted the possibility that the vital waterway for oil shipments would be cut off.
"The market is largely worried about disruption through (the Strait of) Hormuz, but the risk of that is very low," said Saxo Bank analyst Ole Hansen.
Advertisement · Scroll to continue