Oil prices settle up slightly on Iran worries, but prices down for week
Shafaq News/ Oil prices edged up on Friday on reports Iranwas preparing a retaliatory strike on Israel from Iraq in coming days, butrecord US output weighed on prices.
Brent futures were up 29 cents, or 0.4%, to settle at $73.10a barrel. US West Texas Intermediate (WTI) crude gained 23 cents, or 0.3%, tosettle at $69.49. At their session highs, both benchmarks were up over $2 abarrel.
Brent posted a weekly decline of about 4% with WTI downabout 3%.
On Thursday, US news website Axios reported that Israeliintelligence suggests that Iran is preparing to attack Israel from Iraq withindays, citing two unidentified Israeli sources.
"Any additional responses from Iran might remainrestrained, similar to Israel's limited strike last weekend, hence primarilyintended as a demonstration of strength rather than an invitation to openwarfare," said SEB Research analyst Ole Hvalbye.
Iran and Israel have engaged in a series of tit-for-tatstrikes within the broader Middle East warfare set off by fighting in Gaza.Previous Iranian air attacks on Israel on Oct. 1 and in April were mostlyrepelled, with only minor damage.
Iran is a member of the Organization of the PetroleumExporting Countries (OPEC) and produced about 4 million barrels per day (bpd)of oil in 2023, US Energy Information Administration data showed.
Iran was on track to export around 1.5 million bpd in 2024,up from an estimated 1.4 million bpd in 2023, according to analysts and USgovernment reports.
Iran backs several groups that are currently fightingIsrael, including Hezbollah in Lebanon, Hamas in Gaza and the Houthis in Yemen.
A US official asked Lebanon to declare a unilateralceasefire with Israel to revive stalled talks to end Israeli-Hezbollahhostilities, a senior Lebanese political source and a senior diplomat said - aclaim denied by both sides.
Oil prices were also supported by expectations OPEC+ coulddelay December's planned increase to oil production by a month or more onconcern over soft oil demand and rising supply. A decision could be made asearly as next week.
OPEC+ includes OPEC and its allies like Russia andKazakhstan.
As OPEC+ holds back on production, US oil major Exxon Mobil (XOM.N),opens new tab said its global output hit an all-time high, while Chevron(CVX.N), opens new tab said its US production hit a record high.
The US Energy Information Administration (EIA) said thisweek that drillers pulled a record 13.5 million barrels per day (bpd) of oilout of the ground. EIA also said this week that output in August hit a record13.4 million bpd, and has said that annual output was on track to hit a record13.2 million bpd in 2024 and 13.5 million bpd in 2025.
US Job Growth Stalls
US job growth almost stalled in October as labor strikes inthe aerospace industry depressed manufacturing employment while hurricanesimpacted the response rate for the payrolls survey, making it hard to get aclear picture of the labor market ahead of next week's presidential election.
Polls show the US presidential race is a toss-up betweenDemocratic Vice President Kamala Harris or Republican former President DonaldTrump as the country's next president.
Economists said they expect the US Federal Reserve to cutinterest rates by 25 basis points next Thursday.
After hiking rates aggressively in 2022 and 2023 to tame asurge in inflation, the Fed started to lower rates in September.
Lower rates decrease borrowing costs, which can boosteconomic growth and demand for oil.
(Reuters)
