WTI at $98 as Iran War Negotiations Stall


   
Maria Eugenia Garcia
DTN Energy Editor

   HOUSTON, TX (DTN) -- Oil futures climbed Monday (5/11) after cease-fire 
negotiations aimed at ending the U.S-Iran conflict failed again, with both 
sides dismissing each other's proposals, while disruptions to oil transit 
through the Strait of Hormuz continued to tighten global supplies.

   On Monday, Reuters reported that a survey conducted by the news agency 
showed OPEC's crude production fell by 830,000 bpd, the steepest decline in 
more than two decades, which also fueled concerns over tightening supplies, 
reinforcing bullish sentiment across the energy complex.

   Separately, U.S. Energy Secretary Chris Wright said over the weekend the 
Trump administration is weighing options to curb rising fuel costs, as retail 
fuel prices climbed amid ongoing tensions tied to the Iran conflict.

   Wright said the administration is "open to all ideas" aimed at lowering 
prices at the pump for U.S. consumers, including a temporary suspension of the 
federal gasoline tax.  U.S. retail gasoline prices nationwide climbed to $4.581 
gallon in the week ended May 4, according to data from the U.S. Energy 
Information Administration, the highest level since the Iran conflict started.

   However, market participants remained focused on the Iran war developments, 
as attention also turned to U.S. President Donald Trump's planned visit to 
China this week for talks with Chinese President Xi Jinping.  The agenda is 
expected to center on bilateral economic relations as well as the Iran war 
situation, given China's role as the largest buyer of Iranian oil despite U.S. 
sanctions.  

   The front-month NYMEX WTI futures contract climbed $2.50 to $97.92 bbl, 
while the July ICE Brent futures contract increased $2.87 to $104.16 bbl.

   June RBOB gasoline futures advanced $0.0726 to $3.5993 gallon, the 
front-month ULSD contract increased $0.0823 to $3.9814 gallon.

   The U.S. dollar index dropped 0.041 points to 97.825 against a basket of 
currencies. 




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