Oil prices rose on Thursday as traders welcomed signs of progress in US-China trade talks. Brent crude finished the day at $66.46, up 1.71%, while WTI crude climbed to $64.57, a 1.89% gain. Murban crude also gained, closing at $66.41. Natural gas edged higher too, up 0.82% to $3.707.
Why Are Prices Going Up?
Prices are rising for a few key reasons:
- US-China Trade Talks: Renewed talks between the United States and China lifted market optimism, helping support oil prices this week. Brent crude is set for a 3% weekly gain.
- Geopolitical Risks: Tensions remain high with no progress on US-Iran and Russia-Ukraine negotiations. These uncertainties keep oil traders cautious and add to prices.
- Canada Wildfire Risk: Fires in Alberta earlier this week had threatened oil supplies. While rain helped, upcoming heatwaves may bring the danger back.
Iran Sanctions Return
The US government announced new sanctions targeting Iran after nuclear talks collapsed. Iran refused to give up its enriched uranium, and in response, Washington sanctioned 10 individuals and 27 companies involved in oil smuggling. This move could reduce Iran’s oil supply to the market.
Saudi Arabia Cuts Oil Prices
Saudi Aramco has lowered the price of oil for Asian buyers in July by $0.20 per barrel for lighter grades and $0.10 for Arab Medium. The reduction, which brings prices back to May levels, is smaller than analysts expected. Saudi officials said demand is healthy and stock levels are low in Asia.
Other Energy Headlines
- Iraq Accuses Kurdistan: Iraq blamed the Kurdish Regional Government (KRG) for smuggling around 150,000 barrels per day of oil in defiance of Baghdad’s orders.
- Petrobras Eyes Africa: Brazil’s state oil firm Petrobras says Africa will be its top overseas investment destination. It is eyeing offshore oil blocks in Ivory Coast, with Nigeria, Angola, and Namibia also in focus.
- Petronas Restructures in Canada: Malaysian oil company Petronas denied it’s exiting Canada but plans to cut 10% of its workforce there.
Russia’s Discount Shrinks
Russian Urals oil, long sold at discounts due to sanctions, is now just $2.25 below Brent, the smallest gap since the Ukraine conflict began. This means Russia is fetching higher prices again, although still under the $60 per barrel cap.
Other Market Highlights
- Copper: Prices hit a two-month high at $9,810 per tonne due to low stockpiles.
- Silver: Spot silver jumped past $36/oz, its highest since 2012, rising 24% this year thanks to industrial demand and investor interest.
- Clean Energy Investment: The IEA reports global energy investment will reach a record $3.3 trillion in 2025, with $2.2 trillion going into clean energy technologies.
- LNG Supply: US LNG exports dipped to 13.8 billion cubic feet/day due to maintenance at key plants like Sabine Pass.
Stay tuned for more updates as energy markets continue to respond to both global events and supply trends.