By William L. Watts,
NEW YORK (MarketWatch) — Oil futures lost a little ground Wednesday as worries over Iraq and other geopolitical hot spots eased and traders focused on growing crude supplies.
On the New York Mercantile Exchange, WTI crude oil for August delivery CLQ4 -0.51% fell 38 cents, or 0.4%, to $104.96 a barrel. On the ICE, August Brent futures UK:LCOQ4 -0.70% fell 55 cents, or 0.5%, to $111.74 a barrel.
“In Iraq, most of the bad news has already been priced in, so it may take a significant escalation of the conflict there for oil prices to find renewed strength on just this one factor. What’s more, investors are making a more sober assessment of the conflict there, realizing that most of Iraq’s oil is exported from refineries in the south of the country, where the situation is normal,” said Fawad Razaqzada, analyst at Forex.com, in a note.
Meanwhile, investors have shrugged off the end of a ceasefire in Ukraine, while rebels in eastern Libya have reportedly reopened two oil ports, he said.
The Iraq conflict in June drove both WTI and Brent crude futures to nine-month highs.
On the supply front, traders are awaiting the Energy Information Administration’s weekly crude inventories report due later Wednesday. The American Petroleum Institute late Tuesday said crude supplies fell 875,000 barrels in the week ended June 27. Analysts surveyed by Platts have forecast a decline of 2 million barrels.
While worries about the impact of violence in Iraq on the country’s roughly 2.5 million barrels-a-day of oil exports have faded, drivers heading out for the July 4 holiday will face the highest gasoline prices since 2008, due in part to the renewed violence.
Gasoline futures, however, were under pressure Wednesday on concerns Tropical Storm Arthur, which is heading up the eastern U.S. seaboard could cut into holiday fesitivities, said Phil Flynn, senior market analyst at Price Futures Group.
August gasoline futures fell 1.7 cents, or 0.6%, to $3.0193 a gallon. August natural gas NGQ14 -0.81% fell 3.4, or 0.7%, cents to $4.421 per million British thermal units.
