Oil drops as sanctions lifted on former Iran official
Oil reversed gains after the U.S. lifted sanctions on a former Iranian oil official and two other Iranians involved in oil trading, potentially paving the way for a further return of the Persian Gulf countrys output.
Futures in New York slid as much as 1.8% on Thursday before paring losses. The market has been watching for signs of developments in talks between Iran and world powers to revive a 2015 nuclear agreement, which could spur more Iranian barrels returning to the market.
Still, prices remain higher this year amid recovering consumption, with the Organization of Petroleum Exporting Countries seeing the global demand recovery gathering steam in the second half of the year. Oil consumption will jump by about 5 million barrels a day -- or roughly 5% -- in the second half of 2021 versus the first as the world emerges from the pandemic slump, the OPEC forecast in a report.
West Texas Intermediate for July delivery rose 16 cents to $70.12 a barrel at 1:29 p.m. in New York. Brent for August settlement rose 20 cents to $72.42 a barrel.
While headline prices remain driven by the recovery in consumption, a longer-term debate continues to rage about the viability of oil investments. Group of Seven leaders are discussing plans to shift the balance of car-buying away from gasoline to greener vehicles by the end of the decade. That comes just a day after Shell said it would hasten its reduction in carbon emissions.
