Iran tension and doubts over Iraq supplies stabilise oil prices

Crude Oil

USA crude CLcv1 rose 0.82 percent to $51.87 per barrel and Brent LCOcv1 was last at $57.86, up 1.21 percent on the day.

Brent crude for December LCOZ7, +1.31% gained 65 cents, or 1.1%, to $57.82, also ending around its highest level since late September. "We otherwise see the oil market as still amply supplied, which would rather justify a Brent price of $50 per barrel", said analysts at Commerzbank. 78 per barrel, slightly down from their last settlement, but 2 percent higher than last Friday and nearly a quarter above mid-June levels.

Oil prices crept higher on Tuesday, holding on to gains made as fighting between Iraqi and Kurdish forces threatened supplies from northern Iraq, while political tension rose between the USA and Iran.

Tension between the United States and Iran is also rising, increasing the global risk premium for oil.

Iraq is the second-largest oil producer in the Organization of the Petroleum Exporting Countries.

"In the case of Kurdistan, the 500,000 bpd Kirkuk oil field cluster is at risk", Goldman Sachs said in a note to clients.

The crude oil prices were also supported by worries over renewed USA sanctions against Iran as on Friday, President Donald Trump refused to certify to Congress that Tehran is complying with the 2015 Iran nuclear agreement.

"These issues (Iraq and Iran) remind us oil and geopolitics are very much inter-linked and it will remain so... oil security remains a critical issue for all the countries", Fatih Birol, the executive director of the International Energy Agency said in a statement.

OPEC and other key producers made a decision to curb oil output by 1.8 million bpd from January this year to March next year.

In an otherwise typically quiet Monday market, the price of Crude Oil is up nearly 1.7% since this week's open, as at the time of writing.

The euro traded at $1.1782, slightly down from the previous day.

Copper jumped 3.7 percent to $7,134 per tonne on the London Metal Exchange, after touching the July 2014 high of $7,177 a tonne, driven by economic data from China, the world's top copper consumer.

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