Crude oil prices rose modestly on the New York market Oct. 16 with the December contract settling above $52/bbl on what analysts called continuing political tensions in the Middle East. Crude prices continued to rise Oct. 17.
Iraqi troops took control of some oil fields in the semi-autonomous Kurdish region in the oil-rich province of Kirkuk. Violence between Iraqi fighters and Kurdish forces on Oct. 16 stemmed from an ongoing dispute about Kurdish independence.
The latest tensions stem from a September referendum in which the Kurds voted overwhelmingly in favor of independence although Iraq’s central government opposes that.
Kirkuk province accounts for about 600,000 b/d of oil exports, mainly via a pipeline that runs through Turkey. Analysts said some exports could be blocked because of the dispute. Turkey has sided with the central Iraqi government.
Oil prices also gained on uncertainty about the future of US participation in an international agreement on the lifting of sanctions against Iran regarding its nuclear program.
US President Donald Trump last week refused to recertify the 2015 deal, punting a decision to Congress on whether to impose fresh sanctions on Iran. The lifting of sanctions in early 2016 allowed Iran to increase its production to around 3.8 million b/d.
But new US sanctions could limit Iran’s export capacity, reducing global supplies.
Energy prices
The November light, sweet crude contract on the New York Mercantile Exchange rose 42¢ to $51.87/bbl on Oct. 16. The December contract was up 41¢ to $52.14/bbl.
The NYMEX natural gas price for November fell 5¢ to a rounded $2.95/MMbtu. The Henry Hub cash gas price was $2.87/MMbtu, down 14¢.
Heating oil for November increased 1¢ to $1.81/gal. The NYMEX reformulated gasoline blendstock for November fell less than a penny to a rounded $1.61/gal.
The Brent crude contract for December on London’s ICE climbed 65¢ to $57.82/bbl. The January contract was up 61¢ to $57.56/bbl. The gas oil contract for October increased $7.25 to $541/tonne.
The Organization of Petroleum Exporting Countries’ basket of crudes for Oct. 16 was $55.74/bbl, up 62¢.
Contact Paula Dittrick at [email protected].
