Oil Falls After Iraqi Government Pledge

Brent crude fell for the third time in four days as Iraq pledged to increase output and exports. West Texas Intermediate traded near $106 a barrel amid speculation that an Obama administration ruling on U.S. fuel exports will have a limited impact on markets.

Iraqi production has been unaffected by fighting with militants and the country plans to increase crude exports next month from about 2.5 million barrels a day in June, Oil Minister Abdul Kareem al-Luaibi said in an interview in Baghdad. The U.S. Commerce Department granted Pioneer Natural Resources Co.’s request to classify stabilized condensates as fuel eligible for export, the company said. WTI surged as much as 1.4 percent before retreating.

“The geopolitical situation isn’t improving but the Iraqis are continuing to pump oil and say they intend to increase shipments,” said Phil Flynn, senior market analyst at the Price Futures Group in Chicago. “WTI is showing some strength on the potential for exports of U.S. oil. This could bring the spread in a bit.”

Brent for August settlement declined 99 cents, or 0.9 percent, to $113.47 a barrel on the London-based ICE Futures Europe exchange at 9:27 a.m. New York time. The volume of all futures traded was 44 percent higher than the 100-day average. Brent has climbed 2.4 percent this year.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza