Oil mar­kets tense af­ter west­ern strikes on Syria, ris­ing U.S. drilling weighs

Tehran Times - - ENERGY -

Oil fell more than 1 per­cent on Mon­day as mar­kets opened fol­low­ing west­ern air strikes in Syria over the week­end, while a rise in U.S. drilling for new pro­duc­tion also dragged on prices.

The United States, France and Britain launched 105 mis­siles on Satur­day, tar­get­ing what they said were three chem­i­cal weapons fa­cil­i­ties in Syria in re­tal­i­a­tion for a sus­pected poi­son gas at­tack in Douma on April 7.

Brent crude oil fu­tures were at $71.78 per bar­rel at 0643 GMT, down 80 cents, or 1.10 per­cent, from their last close.

U.S. West Texas In­ter­me­di­ate (WTI) crude fu­tures were down 68 cents, or 1.01 per­cent, at $66.71 a bar­rel.

Traders said mar­kets in Asia be­gan cau­tiously af­ter the week­end strikes, with some re­lief that the move looked un­likely to es­ca­late.

“In the wake of the co­or­di­nated at­tack on Syria, oil prices are sig­nif­i­cantly lower ... (but) the im­pact ap­pears to be com­pact and over,” said Sukrit Vi­jayakar, di­rec­tor of en­ergy con­sul­tancy Tri­fecta.

Oil mar­kets also came under pres­sure from a rise in U.S. oil drilling ac­tiv­ity.

U.S. en­ergy com­pa­nies added seven oil rigs drilling for new pro­duc­tion in the week to April 13, bring­ing the to­tal to 815, the high­est since March 2015, en­ergy ser­vices firm Baker Hughes said on Fri­day.

De­spite this, Brent is still up more than 16 per­cent from its 2018 low in Fe­bru­ary, due to healthy de­mand and also be­cause of con­flict and ten­sion in the Mid­dle East.

Al­though Syria it­self is not a sig­nif­i­cant oil pro­ducer, the wider Mid­dle East is the world’s most im­por­tant crude ex­porter and ten­sion in the re­gion tends to put oil mar­kets on edge.

“In­vestors con­tin­ued to worry about the im­pact of a wider con­flict in the Mid­dle East,” ANZ bank said.

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