Oil settles near $70 as traders wait for Iran decision

Oil prices hit a new high for the year as domestic production continues about 10 million barrels per day (bbl/d) and traders continue to wait for the Trump administration’s decision about whether to exit the Iran nuclear deal.

West Texas Intermediate futures contracts for June delivery settled at $69.72 per barrel Friday, up $1.29 (1.9 percent) on the day and up $1.62 (2.4 percent) for the week. The intraday high was $69.97.
The average price for a barrel of WTI this year is $63.98.

Commercial crude inventories increased 6.2 million bbl this week to 436 million bbl. Total motor gasoline inventories were at 238 million bbl, kerosene-type jet fuel was at 39.8 million bbl and distillates was at 118.8 million bbl.

Crude production rose by 33,000 bbl/d to 10.6 million bbl/d.

While oil prices rose this week, traders are anticipating the Trump administration’s decision over whether to back out of the Iran nuclear deal. Iran is an OPEC member and major crude oil exporter. A decision is expected by May 12.

The spread between Plains Marketing’s WTI “all other areas” and West Texas sour posted prices widened greatly after sour was priced far lower on Tuesday. The previous spread of $3.80 is now $7.50 after sour was reduced by $5.20 Tuesday. Prices generally rise and fall in the same increments.

On Friday, the WTI posted prices was $66.25 per barrel, up $1.50 (2.3 percent) on the day and up $1.75 (2.7 percent) for the week. Sour fetched $58.75 on Friday, up $1.50 (2.6 percent) on the day but down $1.95 (3.21 percent) for the week.

Despite the price adjustment, sour is still higher on the year. It’s up $5.95, (10.8 percent). WTI is up $7.75 (13.6 percent).

Friday’s price marked a new year high for WTI. The high for sour is $61.45. The average price for a barrel of WTI is $60.47; it’s $57.26 for sour.

In other futures trading Friday, July contracts rose by $1.32 to $69.58, August was up $1.36 to $69.12 and September jumped $1.40 to $68.82.