Oil prices still over $100

On the London market, a barrel of Brent oil traded in the afternoon at a price of $103.19, $1.9 or almost two percent higher than at the close of trade on Friday. A barrel of the WTI brand on the US market was sold at a price of $96.98, higher by $1.56 or by 1.6 percent.

This morning, prices briefly reached $105.99 for a barrel of Brent oil and $100.37 for a barrel of WTI, after which they were corrected downwards. Last week’s trading ended in minus six percent under the influence of hope for the end of the conflict and the opening of the Strait of Hormuz for oil transit.

President Trump assessed on Sunday that Iran’s response to the American proposal to end the war was “totally unacceptable”. The Iranian news agency Tasnim emphasized, referring to well-informed sources, that the Iranian response sent to the US through the intermediary of Pakistan emphasizes the need for an end to the war on all battlefields and the lifting of sanctions against Tehran, as well as an end to the naval blockade of Iran and Iranian management of the Strait of Hormuz.

“The oil market continues to largely operate like a machine that processes major geopolitical news, with prices changing sharply based on every comment, rejection or warning from Washington and Tehran,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

For further guidance, the market will watch this week’s US-China summit, to which the focus is now shifting. President Trump is scheduled to arrive in Beijing on Wednesday, and according to US officials, he is expected to discuss Iran with his Chinese counterpart Xi Jinping, among other things.

“Despite reassuring announcements that communication exists and that the negotiating parties are talking, our view is that the US and Iran are as far from a deal as they were when this supposed truce began. We don’t see anything changing before Trump visits China and asks Beijing for help in pressuring Iran,” said PVM Oil Associates analyst John Evans.

The world has lost about 1 billion barrels of oil in the past two months and energy markets will take time to stabilize even if the flow of oil continues, Saudi Aramco CEO Amin Nasser said on Sunday.

“We stand by our assessment that prices will rise and agree with Saudi Aramco leaders that even if the Hormuz situation is resolved and it is open for transit, it will take many months to normalize oil supplies,” Evans said.

Saudi Arabia’s crude oil exports to China are expected to fall further in June after buyers cut orders due to high prices linked to the US-Iran conflict and lower inventories, trade sources told Reuters.

Meanwhile, three tankers carrying crude oil passed through the Strait of Hormuz last week, data from analytics company Kpler showed. One was loaded with Iraqi crude oil and headed for Vietnam. Japan’s Industry Ministry said a tanker carrying Azeri crude oil should arrive as early as Tuesday, the first cargo of oil received from Central Asia since the war with Iran began.

Separate calculations by the Organization of the Petroleum Exporting Countries (OPEC) show that a barrel of the oil basket of its members last Friday was 1.20 dollars more expensive than the day before and stood at 107.66 dollars.

(Vijesti.ba)