LONDON: Oil prices steadied on Thursday, taking a breather after gains spurred by rising tension in northern Iraq following the semi-autonomous Kurdistan region’s vote for independence in a referendum.
Brent crude oil LCOc1 was unchanged at $57.90 a barrel by 08:50 GMT. It hit a more than two-year high of $59.49 on Tuesday after Monday’s referendum vote prompted Turkey to threaten to close the region’s oil pipeline, before pulling back.
US light crude CLc1 was 5 cents higher at $52.19 after rising 26 cents on Wednesday to just below a five-month high. “Profit taking and the fact that Kurdish oil exports seem unaffected by the referendum pushed crude lower,” said Tamas Varga, analyst at London brokerage PVM Oil Associates.
“But I think the market will strengthen again. Kurdistan and Northern Iraq now export 500,000-550,000 barrels per day (bpd). That would be a big loss to the market,” Varga added. Iraqi Kurdistan voted overwhelmingly on Monday in favour of independence, prompting Turkish President Tayyip Erdogan to say he could use military force to prevent the formation of an independent Kurdish state and might close the oil “tap”.
Turkey said on Thursday it would deal only with the Iraqi government on crude oil exports, “restricting oil export” operations to Baghdad.
US crude prices found some strength from a surprise fall in US stocks.
US crude inventories fell 1.8 million barrels last week, the US Energy Department said, versus forecasts for a 3.4 million-barrel build. — Reuters
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