Previously, Iran’s Minister of Defense, Aziz Nasirzadeh, stated that Tehran would target US bases in the region should nuclear negotiations fail and conflict with Washington emerge.
Trump expressed reduced confidence in Iran’s willingness to cease uranium enrichment as part of a nuclear agreement with Washington, according to an interview released on Wednesday.
Persistent tensions with Iran indicate that its oil supplies are likely to remain restricted by sanctions.
OPEC+ will increase oil production by 411,000 barrels per day in July, but increased demand from OPEC+ economies, especially Saudi Arabia, could offset this. A US-China trade deal also contributes to elevated oil prices by boosting energy demand in both countries.
Trump stated Beijing would provide magnets and rare earth minerals, and the US would admit Chinese students to its colleges. The deal awaits approval from Trump and President Xi Jinping. PVM analyst Tamas Varga noted that while trade-related oil downside risk is temporarily removed, market reaction is tepid due to uncertainty about economic growth and global oil demand impact.
Crude inventories in the US decreased by 3.6 million barrels last week, reaching 432.4 million barrels, according to the Energy Information Administration. Analysts surveyed by Reuters had anticipated a reduction of 2 million barrels.
“This is a bullish report,” stated Bob Yawger, director of energy futures at Mizuho, noting an increase in demand for motor gasoline.
Product supplied for motor gasoline, serving as an indicator of demand, rose by approximately 907,000 barrels per day last week, reaching 9.17 million bpd.
US consumer prices experienced only a marginal increase in May, reinforcing financial market expectations that the Federal Reserve will commence interest rate cuts by September. Reduced interest rates are capable of stimulating economic growth and oil demand.
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