Oil rose after Iran’s accord with world powers left the timing of more crude exports from the OPEC member uncertain and as Saudi Arabia increased pricing in a sign of demand.
Futures climbed as much as 2.5 percent in New York. The preliminary agreement outlined Thursday signals the Persian Gulf nation may be able to boost overseas shipments within months of a final deal that negotiators aim to conclude in June. Saudi Arabia, the world’s largest crude exporter, raised pricing for all May sales to Asia, after the country’s oil minister said global demand is improving.
An increase in exports from Iran would threaten a potential price recovery after a supply glut drove oil almost 50 percent lower in 2014. State-owned Saudi Arabian Oil Co., which cut pricing to Asia earlier this year to compete with cargoes from Latin America, Africa and Russia, narrowed the discount for its Arab Light grade to Asia to the least since December.
West Texas Intermediate for May delivery rose as much as $1.21 to $50.35 a barrel in electronic trading on the New York Mercantile Exchange and was at $50.20 at 9:25 a.m. Seoul time. The contract lost 95 cents to $49.14 on Thursday. The volume of all futures traded was about 12 percent below the 100-day average. The exchange was closed April 3 for the Good Friday holiday.
Brent for May settlement added as much as $1.05, or 1.9 percent, to $56 a barrel on the London-based ICE Futures Europe exchange. It slipped $2.15 to $54.95 on Thursday. The European benchmark crude traded at a premium of $5.84 to WTI.
The U.S. and European Union would lift economic sanctions against Iran if the International Atomic Energy Agency verifies Iran’s compliance with curbs on its nuclear program, under the accord.
Source : Bloomberg