Oil jumps 5%, then pares gains after Trump says no attack on Iran this month
USO•Oil prices rose more than 5% before paring gains after Trump said the US would not attack Iran before November’s midterm elections. Brent was up 3.5% at $103.73 a barrel and WTI gained 3.1% to $91.
1. Prices pare gains
Brent crude futures rose $3.48, or 3.5%, to $103.73 a barrel by 12:41 p.m. ET, while US West Texas Intermediate gained $2.69, or 3.1%, to $91. Both contracts had earlier climbed more than $5 a barrel. Prices pared gains after Trump said Washington was having productive discussions with Iran and would not launch an attack before the November midterm elections.
2. Supply risks persist
Threats to oil shipping in the Gulf and Strait of Hormuz have increased during the Iran conflict, which entered its eighth month. Tanker attacks in the strait reached their highest level since the war began last week, while the waterway had carried shipments equal to about 20% of global oil and fuel before the war.
3. Storm curbs output
Hurricane Isaias prompted Shell, Chevron and BP to curtail Gulf of Mexico operations. Producers had shut in about 25.08% of current Gulf oil production and 16.37% of natural gas production as of Wednesday. US crude stockpiles also fell by more than expected, while diesel inventories declined slightly.
