Oil prices rise in early Asian trade
TOKYO – Oil prices rose slightly on Friday in thin trade in Asia, underpinned by a power outage at Britain’s largest oilfield, though risks of oversupply following the Iranian nuclear deal and mixed economic data held back prices.
A decision on Thursday to reopen funding to near-bankrupt Greece, enabling it to make debt payments, improved risk sentiment, though lower jobless claims in the U.S. boosted expectations for a rate hike.
“Commodities are likely to remain range-bound as markets digest mixed global economic data,” ANZ bank said in a morning note.
Front-month U.S. crude futures were trading at $51.11 per barrel at 0102 GMT, up 20 cents from their last settlement. Front-month Brent crude was up 26 cents at $57.18 a barrel.
U.S. crude is heading for a third weekly decline and is down more than 3 percent this week, while Brent is down almost 3 percent and also on track for a third week of declines.
Britain’s North Sea Buzzard oilfield was shut down on Thursday after experiencing problems on Wednesday night, several traders said. It was expected to come online by Friday.
Still, the market remains in oversupply with around 2.5 million barrels per day in excess of demand and the likelihood of more oil flowing from Iran, after the nuclear deal between Tehran.
An Iranian supertanker with two million barrels of oil is heading to Asia after sitting of the coast of Iran for months, the first vessel storing crude offshore to sail after the agreement, data showed on Thursday.
“We continue to view the Iran nuclear deal as a negative price catalyst over the medium to long term,” ANZ said.
In the U.S., data from industry intelligence firm Genscape showing higher crude inventories at the Cushing, Oklahoma, hub, the delivery point for the U.S. crude contract. – Reuters