Oil Steady on Prospects of Rising Russian, Iraqi Suppl
Oil steadied after a series of declines as the prospect of rising flows from Iraq and Russia weighed on the outlook, with market gauges showing signs of softening on the possibility of a supply glut.
Brent traded below $75 a barrel, while West Texas Intermediate neared $71. The front-month WTI contract was trading at 1 cent lower a barrel than the next-month contract, the first time since November that the so-called prompt spread had turned negative in a bearish structure known as contango.
The change in the bullish backwardation pattern came after two of the world’s major oil forecasters said last week that there would be a mild supply glut this year. Supply concerns worsened over the weekend, with the president of Iraq’s semi-autonomous Kurdistan region hinting at a possible resumption of oil exports next month and President Donald Trump’s push to end the war in Ukraine raising the prospect of rising flows from Russia.
“Sentiment in the oil market continues to deteriorate with persistently weaker prices, while the time horizon also points to a weaker physical market,” said Warren Patterson, head of commodity strategy for ING Groep NV.
Crude has been roiled by Trump’s swift tariffs — some of which have been dramatically reduced — and threats of sanctions on producers including Iran. Prices jumped on Friday after U.S. Treasury Secretary Scott Bessent said the administration aims to reduce Tehran’s oil exports to less than 10% of current levels, before easing amid doubts about the viability of the plan.
Brent for April delivery was up 0.2% at $74.86 a barrel at 1:53 p.m. in Singapore.
WTI for March delivery was steady at $70.74 a barrel.
Source: Bloomberg
