Oil futures edged higher Tuesday, with the U.S. benchmark taking back some ground lost the previous day, as traders looked for renewed sanctions on Iran to weigh on supply and awaited weekly U.S. supply data.
October futures on West Texas Intermediate crude CLV8, +0.36% the U.S. benchmark, rose 19 cents, or 0.3%, to $67.73 a barrel. November Brent crudeLCOX8, +0.79% was up 50 cents, or 0.6%, to $77.87 a barrel.
“Not only is there strong demand among financial investors, who are primarily on the buyer side due to the ‘risk-on’ mood on the financial markets, a somewhat weaker U.S. dollar and expectations of falling Iranian exports — physical demand also remains robust,” wrote Eugen Weinberg, analyst at Commerzbank, in a note.
Weinberg noted earlier data showing China’s August crude imports were up 12.9% year over year, while imports over the first eight months were up 6.5% over the same period a year ago. Monthly data from the Energy Information Administration later this week is expected to affirm strong underlying demand, he said, while traders will pay close attention to weekly storage data due late Tuesday from the American Petroleum Institute followed by official weekly EIA data on Wednesday.
Traders will continue to keep a close eye on Hurricane Florence as it approaches the U.S. East Coast. Authorities ordered widespread evacuations along the coasts of the Carolinas and Virginia. The storm track could change, but the latest forecasts indicate tropical storm-force winds could begin to hit the Carolinas by early Thursday.
Concerns that Florence could weaken energy demand on the East Coast contributed to a weaker tone for the U.S. benchmark on Monday, analysts said.
October natural gas NGV18, +0.21% rose 0.3% to $2.812 per million British thermal units.