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LONDON - Oil prices rose today after six straight losing sessions as markets turned attention to Iran's nuclear activities and dwindling petrol stocks in the United States, the top consumer.
Price falls that began on March 30 had gathered pace last week, when Iran released 15 British sailors and marines it had captured, wiping more than $4 off a barrel of US crude.
US crude settled up 38 cents to $61.89 a barrel, after tumbling $2.77, or 4.3 per cent, on Monday. London Brent crude was up 83 cents at $67.42, after a $1.65 loss in Monday trade, which was subdued by the Easter holiday.
Iranian President Mahmoud Ahmadinejad said on Monday that his country had begun industrial-scale uranium enrichment, which the West fears could be used to make nuclear weapons.
Iran says it wants the fuel for generating electricity, so it can export more of its oil and gas.
"After the release of the sailors, we're now back to the ongoing issue of the nuclear file," said Frederic Lasserre, head of commodities research at Societe Generale. "The market is much more skewed to the upside on political fronts."
Traders were also closely watching petrol supplies in the United States prior to the peak summer driving season. Stocks of the motor fuel have dropped nearly 10 per cent since early February amid refinery outages.
A Reuters poll of analysts forecast US government data due on Wednesday would show petrol stocks fell 1.4 million barrels last week, alongside a build in crude stocks of 1.6 million barrels.
Brent premium
Brent crude has reached a record premium to US crude of around $6 a barrel. That reflects relatively high stockpiles at the key United States storage hub at Cushing, Oklahoma, as pipeline constraints and refinery outages create a regional glut, analysts said.
The wide spread has also been exacerbated by curbed production from Nigeria due to militant attacks on the oil industry and the simmering tensions with Iran. Both oil producer nations are closer to the European market.
Barclays Capital technical analysts said US crude had tested support at $61.35 in Monday's sell-off and could go still lower in the short term.
"Bigger picture, price action remains in a bull trend, with higher highs likely later in the month," they wrote in a note.
Adding support to prices, China imported 8.9 per cent more crude in March than a year earlier to reach a near record, official data showed on Tuesday, as refiners geared up for a spring demand boost from farmers and construction work.
- REUTERS
