Oil Prices Edge Higher Eyeing Weekly Decline, Monthly Jump


   
Karim Bastati
DTN Analyst

   VIENNA (DTN) -- Oil prices advanced Friday (7/31) morning, on track for a 
weekly decline on signs that disruptions to Red Sea oil flows were less severe 
than originally feared. Despite the move lower, prices were amid a reheating 
U.S.-Iran war and mounting supply disruptions still eyeing the largest monthly 
jump since March.

   By 07:55am ET, ICE Brent for September delivery on its last trade date rose 
$1.20 to $90.23 bbl, and the October contract gained $1.54 to $88.42 bbl. NYMEX 
WTI for September delivery rose $1.27 to $84.86 bbl.

   Downstream, NYMEX ULSD futures for August delivery on their last trade day 
advanced $0.0786 to $4.2880 gallon, and the more actively traded September 
contract gained $0.0698 to $4.1989 gallon. RBOB for August and September 
delivery softened by $0.0221 and $0.0090 to $3.2626 gallon and $3.1223 gallon, 
respectively.

   The US dollar index strengthened by 0.444 points to 100.165 against a basket 
of foreign currencies.

   Flows through Bab-el-Mandeb picked up throughout the week after plummeting 
on Houthi attacks on tankers and an announcement of their blockade of Saudi 
Arbian maritime traffic. Yet, oil flows through the chokepoint remained below 
typical levels, and traffic through the Strait of Hormuz continued at little 
more than a trickle.

   On Thursday, the Caspian Pipeline Consortium again halted oil loadings at 
its Black Sea terminal after two tankers were struck by drones. This came just 
two days after operations resumed following a week-long suspension caused by 
drone attacks on several ships. Reports emerging Friday morning suggested that 
CPC was considering indefinitely pausing operations until receiving safety 
guarantees from other states, affecting some 1.2 to 1.4 million bpd of global 
crude oil supply.

   Amid escalating fighting in the Middle East, war-induced refinery outages in 
Russia and the Persian Gulf, and growing disruptions of vital oil shipping 
routes, oil prices found themselves on a steep upward trajectory in July. As of 
Friday morning, crude benchmarks Brent and WTI were trading more than 20% 
higher than at the beginning of the month, and ULSD futures were up more than 
30%.




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