West Texas Intermediate oil dropped to a two-week low and Brent fell on signs that the insurgency in Iraq won’t curb output and as U.S. stockpiles climbed.
Iraq’s crude exports will increase next month, Oil Minister Abdul Kareem al-Luaibi said yesterday. Government forces repelled an attack by the Sunni Islamic State in Iraq and the Levant on the Baiji refinery north of Baghdad. U.S. crude stockpiles rose by 1.74 million barrels to 388.1 million last week, the Energy Information Administration said yesterday.
“Prices are retreating because the insurgency hasn’t had a material impact on the Iraqi production and we might be looking at a gain in exports,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “Prices are consolidating here just below the nine-month highs.”
WTI for August delivery slipped $1.19, or 1.1 percent, to $105.31 a barrel at 11:21 a.m. on the New York Mercantile Exchange. Prices reached $105.15, the lowest intraday level since June 12. Futures are up 7 percent this year.
Brent for August settlement fell 77 cents, or 0.7 percent, to $113.23 a barrel on the London-based ICE Futures Europe exchange. Futures slipped to $113.11, the lowest level since June 18. Prices have increased 2.2 percent this year.
The European benchmark crude’s premium to WTI widened to $7.92 from $7.50 yesterday.