Crude flipped between gains and losses as investors await the impact of coming disruptions on Iranian oil.
US and international benchmark oil prices barely moved Monday, dipping briefly negative before eking out gains of less than a percent each. Still, futures traded in New York are on track to gain more than 5 percent in April, a boost that will - if it holds - help the US price post its best first four months of a year since 1999.
Waivers that allowed China and several other major buyers to purchase Iranian oil will expire May 2, cutting off a significant source of supply. US President Donald Trump over the weekend renewed calls for Saudi Arabia and OPEC to pump more crude.
“Uncertainty about what eventually is going to happen with those sanctions is kind of keeping the market unnerved,” said Gene McGillian, manager of market research at Tradition Energy. “The Saudis said they are not going to immediately boost production levels and that’s also adding to the uncertainty.”
Oil touched a six-month high last week after the White House announced the end of sanctions exemptions on Iranian crude. Investors are waiting to see whether Saudi Arabia will ramp up production to make up for any supply shortfalls after Trump said on Twitter he had spoken with suppliers about boosting oil flows and that “all are in agreement.”
West Texas Intermediate for June delivery was trading up 24 cents to $63.54 a barrel at 13:03 on the New York Mercantile Exchange.
Brent for June settlement climbed 24 cents to $72.39 a barrel on the London-based ICE Futures Europe exchange after earlier falling as much as 1.5 percent. The global benchmark crude was at a premium of $8.84 to WTI.
Saudi Energy Minister Khalid Al-Falih said last week that the world’s biggest oil exporter will cater to customers’ needs, but doesn’t see the need for an immediate response to the Iran situation.
“The US president clearly on-boarded the Saudis before tightening the screws on Iran,” said Stephen Brennock, an analyst at PVM Oil Associates Ltd. in London. Ultimately, the kingdom will probably “lead efforts to prevent the oil market from over-tightening.”