FINWIRES · TerminalLIVE
FINWIRES

Oil Rises Again as the Shaky U.S.-Iran Ceasefire Continues to Block Persian Gulf Supply

By

Oil prices rose for a third session early on Tuesday as a faltering ceasefire between the United States and Iran keeps the Strait of Hormuz closed, continuing the largest-ever energy supply shock.

West Texas Intermediate crude oil for June delivery was last seen up US$3.23 to US$101.30 per barrel, while July Brent oil was up US$3.32 to US$107.53.

The rise comes as a shaky ceasefire in the war on Iran threatens to end, with U.S. President Trump on Monday saying it was on "massive life support" after Iran rejected a U.S. peace plan and Trump rejected Iran's response.

The lack of a deal continues Iran's blockade of the Strait of Hormuz, blocking exports from Persian Gulf nations that accounted for 20% of daily oil demand. Oil prices have climbed by nearly half since the Feb. 28 start to the war, with stalemate between the warring nations offering no quick relief to countries searching for alternative supply.

"Oil prices climbed ... as the global oil market continued to tighten amid limited prospects for a reopening of the Strait of Hormuz. The move followed Trump casting doubt over a ceasefire with Israel signalling the war is not over," Saxo Bank wrote.

Trump will travel to Beijing tomorrow for a summit meeting with Xi Jinping, his Chinese counterpart, a major buyer of Iranian oil and an ally of the country. However the Wall Street Journal reported Xi is unlikely to press Trump to end the war.

Related Articles

Sectors

Natural Gas Falls as Rising Production Offsets Warming Forecasts

Natural gas traded lower early Tuesday despite warm forecasts as production continues to rise. Gas for June delivery was last seen down $0.04 to US$2.87 per million British thermal units.Long-term forecasts from the National Weather Service expect nearly all states to see warmer than seasonal temperatures over its six to 14 day outlook, offering some cooling demand amid the spring shoulder season.However production continues to rise, boosting inventories of the fuel and limiting prices."U.S. production continues to trend higher, supported by solid shale output and rising associated gas volumes from oil directed drilling, particularly in the Permian Basin....Combined with relatively mild winter weather, this has left inventories in a comfortable position," TD Economics wrote.

$NGM6$UNG
Sectors

Sector Update: Energy Stocks Rise Premarket Tuesday

Energy stocks were rising premarket Tuesday, with the State Street Energy Select Sector SPDR ETF (XLE) up 1.1%.The United States Oil Fund (USO) was up 3% and The United States Natural Gas Fund (UNG) was 2% lower.Front-month US West Texas Intermediate crude oil was 3.2% higher at $101.25 per barrel at the New York Mercantile Exchange. Global benchmark North Sea Brent crude oil rose 3.2% to $107.49 per barrel, and natural gas futures were down 1.7% at $2.86 per 1 million British Thermal Units.Venture Global (VG) shares were up more than 7% after the company reported higher Q1 earnings and revenue.Petrobras (PBR) stock was down more than 1% even after the company posted higher Q1 net income and sales revenue.Shell (SHEL) plans to divest its gas station network in France, according to a Google translation of a Monday report from French newspaper Les Echos. Shell shares were up 0.2% premarket.

$PBR$SHEL$UNG$USO$VG$XLE
Sectors

Sector Update: Financial Stocks Edge Higher Pre-Bell Tuesday

Financial stocks were edging higher pre-bell Tuesday, with the State Street Financial Select Sector SPDR ETF (XLF) advancing by 0.1%.The Direxion Daily Financial Bull 3X Shares (FAS) was 0.7% higher and its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ) was down 0.3%.EToro (ETOR) stock was up 0.4% after the company reported an increase in Q1 adjusted earnings.CME Group (CME) said it is partnering with Silicon Data to launch a compute futures market later this year, pending regulatory review. Shares of CME Group were 0.8% higher premarket.Goldman Sachs' (GS) private equity business within Goldman Sachs Alternatives acquired FGI Worldwide, the company said. Goldman Sachs stock was down 0.2% pre-bell.

$CME$ETOR$FAS$FAZ$GS$XLF