Oil steadies as Middle East tensions offset rising United States output

Iran Crude Oil Hits New Year-High

Iran Crude Oil Price Hits New Year-High

Crude oil prices spiked as much as 3 percent early this week after the government in Riyadh rounded up a handful of ministers as part of a sweeping crackdown tacitly broadcast as a move against corruption.

The price for Brent crude oil was down 0.42 percent to $63.42 per barrel as of 9:15 a.m. EST.

Key for the last weeks of 2017 is whether traders remain confident about their huge bets on further price rises, or if they sell out, satisfied with recent strong gains.

Fueling the upturn are expectations that an end to a production cut by the Organization of Petroleum Exporting Countries (OPEC) may be postponed till the end of next year from March, according to some analysts. That coincided with escalating tensions in the region, pitting rivals Iran and Lebanon against Saudi Arabia.

West Texas Intermediate, the US benchmark for the price of oil, was down 0.33 percent to $57.01 per barrel.

"Saudi Arabia is really going all-in again against Iran and that is, for me, more the focus than the domestic issue", Petromatrix strategist Olivier Jakob said.

"There is an exuberance in the market about there being a done deal to extend through the end of 2018 and I think there's likely to be disappointment in that come November 30", Ed Morse of Citigroup told Bloomberg.

Before the EIA released the inventory data, Brent and WTI futures were down about 0.6 percent on data that showed Chinese crude imports fell to a one-year low.

Analysts expected a 2.7 million barrels drop in crude seen, a 2.100 million barrels decline in distillates and a 2.176 million barrels easing in gasoline inventories expected.

In its monthly short-term energy outlook, the agency forecast that USA crude oil output will rise by 720,000 barrels per day (bpd) to 9.95 million bpd in 2018.

South Korea's oil exchange traded funds (ETFs) have posted high returns over the past month on rising global crude prices, a fund evaluator said Thursday.

Supplies at the oil storage hub of Cushing, Oklahoma, rose by 812,000 barrels. Last month, it expected a 680,000 bpd year-over-year increase to 9.92 million bpd.

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