By ANTHONY DIPAOLA
Brent rose as much as 2.2% to $112.34/bbl. WTI, the US
benchmark, advanced 2%. Militants linked to al-Qaeda extended
control over Iraqs second-biggest city and battled for
energy infrastructure, including the nations largest refinery
. US planes may bomb
northern Iraq, Oil Minister Abdul Kareem al-Luaibi said today
The Iraq development is the main driver for oil prices
today and increases nervousness over the security of supply
from the country, Carsten Fritsch, an analyst at
Commerzbank AG in Frankfurt, said by phone today. The
possibility of U.S. intervention in Iraq is another
sign of how desperate the situation is and how weak the
government has become.
Brent for July settlement rose by as much as $2.39 and was at
$112.09/bbl at 1:57 p.m. on the London-based ICE Futures Europe
exchange. The contract
expires tomorrow. The Europe
an benchmark crude traded at
a premium of $5.79 to WTI. The spread widened yesterday for
the first time in four days to close at $5.55.
WTI for July delivery climbed as much as $2.13 to $106.53/bbl
in electronic trading on the New York Mercantile Exchange.
WTI traded as high as $108.99 on Sept. 19. The volume of all
futures traded was about 206% above the 100-day average.
Prices have increased 8% this year.
Militants seized the city of Mosul in northern Iraq and have
forced a halt to repairs to the nations main pipeline
from the Kirkuk oilfield to the Mediterranean port of Ceyhan,
Turkey. The fighters advanced on Saddam Husseins former
hometown of Tikrit, and there were conflicting reports about
whether they had captured the 310,000-bpd Baiji refinery
Iraq is exporting crude from the south and shipped 5.43
million bbl from Basra yesterday, according to Luaibi, the
The countrys military, including air power, attacked
forces of the Islamic State in Iraq and the Levant in Tikrit,
about 80 miles (130 km) north of Baghdad, state-sponsored
Iraqiya television reported today.
US crude stockpiles fell by 2.6 million bbls last week, while
gasoline supplies grew, the US Energy Information
Administration (EIA) reported yesterday. The Organization of
Petroleum Exporting Countries kept its daily production
target unchanged at 30 million bbl, leaving output below
ed for this year.
There should be draws in crude inventories and
increases in gasoline stocks; this is the time of year that
it should happen, said Jonathan Barratt, the chief
investment officer at Ayers Alliance Securities in Sydney.
OPEC obviously likes prices at this level.
Crude inventories declined to 386.9 million bbl in the week
ended June 6, according to the EIA. Supplies were at 399.4
million bbl through April 25, the most since the Energy
Departments statistical arm started publishing weekly
data in 1982.
Stockpiles at Cushing, Oklahoma, the delivery point for WTI,
slid by 198,000 bbl to 21.2 million, the report shows.
Supplies at the largest US storage hub have decreased since
the southern leg of the Keystone XL pipeline began moving oil
to Gulf Coast refineries in January.
Gasoline inventories nationwide expanded by 1.7 million bbl
to 213.5 million bbl, more than a median 1 million gain
estimated in a Bloomberg News survey of
analysts. The peak US driving season typically starts on
Memorial Day, which came on May 26 this year, and runs
through Labor Day on Sept. 1.