Despite a sell-off in equity markets around the globe, oil prices were on the rise today as negotiations between Iran and six world powers over its nuclear programme failed to make any progress.
Iran refused to curb its uranium enrichment programme, which makes it highly unlikely that the sanctions imposed against the Middle Eastern country will be lifted any time soon and that more could follow.
Oil exports from Iran, currently the second largest producer of crude in the Organisation of Petroleum Exporting Countries (OPEC), dropped in March and April as it was hit by a series of sanctions by the US and Europe.
Gains in oil futures were curbed by a Bloomberg report, which said Chinese banks could miss their lending targets this year amid falling demand for credit, adding to concerns that growth in the world’s second largest economy is slowing at a faster pace than expected.
Only yesterday, HSBC said its China PMI index dropped to 48.7 from 49.3 in April, marking the seventh monthly contraction in a row.
Oil prices were still under pressure from this week’s inventories data from the US Department of Energy, which showed that America’s crude stocks added 900,000 barrels last week to reach 382.5 million barrels.
US light, sweet crude for July delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), rose 20 cents to US$90.86/barrel in morning trade in New York.
July Brent crude tacked on 46 cents to reach US$107.01/barrel on the ICE Exchange this afternoon.
Today’s top risers in the sector were:
Mediterranean Oil 7 Gas (LON:MOG), up 11.5 percent at 5.45 pence at midday
Amerisur Resources (LON:AMER), up 11.5 percent at 20.94 pence
Forum Energy (LON:FEP), up 11.5 percent a 145 pence
Nostra Terra Oil & Gas (LON:NTOG), up 4.5 percent at 0.55 pence
Genel Energy (LON:GENL), up 3.5 percent at 641.5 pence
The top fallers were:
Petro Matad (LON:MATD), down 18 percent at 13.26 pence at midday
Argos Resources (LON:ARG), down 5.5 percent at 15.12 pence
Regal Petroleum (LON:RPT), down 5 percent at 21 pence