Oil prices jump 3% as Iran suspends cooperation with UN nuclear watchdog
Oil prices rose 3% on Wednesday as Iran suspended cooperation with the U.N. nuclear watchdog and the U.S. and Vietnam reached a trade deal, but a surprise build in U.S. crude supplies limited price gains somewhat.
Brent crude settled $2.00 higher, or 3%, to $69.11 a barrel, while U.S. West Texas Intermediate crude gained $2.00, or 3.1%, to $67.45 a barrel.
Brent has traded between a high of $69.21 a barrel and low of $66.34 since June 25, as concerns of supply disruptions in the Middle East have ebbed following a ceasefire between Iran and Israel.
Iran enacted a law stipulating any future inspection of its nuclear sites by the International Atomic Energy Agency will need approval by Tehran's Supreme National Security Council. The country has accused the agency of siding with Western countries and providing a justification for Israel's air strikes.
Prices also gained after President Donald Trump and Vietnamese state media said the U.S. and Vietnam had struck a trade agreement that sets 20% tariffs on many of the Southeast Asian country's exports following last-minute negotiations.
Prices pared gains earlier in the session after the U.S. Energy Information Administration said domestic crude inventories rose by 3.8 million barrels to 419 million barrels last week. Analysts in a Reuters poll had expected a drawdown of 1.8 million barrels. Gasoline demand dropped to 8.6 million barrels per day, prompting concerns about consumption in the peak summer driving season.
Meanwhile, planned supply increases by OPEC+, the Organization of the Petroleum Exporting Countries and its allies including Russia, appeared priced in and were unlikely to catch markets off-guard again imminently, said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova.
Source : Reuters
