Brent crude traded near its lowest in a week and West Texas Intermediate slipped amid speculation that Iraqi oil production won’t be disrupted by violence in OPEC’s second-largest producer.
Futures fell as much as 0.5 percent in London. Iraqi forces regained control of the Baiji refinery in the north from Islamist militants, and fighting hasn’t spread to the south, home to more than three-quarters of the country’s crude output. Saudi Arabia can boost oil output to more than 12.5 million barrels a day if needed, according to a Saudi oil official. There isn’t a shortage of supply or need for OPEC to meet because of the Iraq crisis, the group’s secretary-general said.
“Iraq is still the talk of the town, even though the situation on the ground has not escalated materially,” Amrita Sen, chief oil markets analyst at London-based Energy Aspects Ltd., said in a report. “Iraqi supply losses have been minimal so far.”
Brent for August settlement dropped as much as 57 cents to $113.55 a barrel on the London-based ICE Futures Europe exchange and was at $114.27 at 1:01 p.m. London time. The contract slid 0.6 percent to $114.12 yesterday, the lowest close since June 17 and the biggest loss since May 16. The volume of all futures traded was almost double the 100-day average for the time of day. Prices are up 3.1 percent this year.
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