Crude oil futures steady on mixed EIA data, geopolitical risks

Singapore — Crude oil futures were steady to marginally higher during mid-morning trade in Asia Thursday, amid mixed data on US inventory levels while market participants keep watch on geopolitical developments in the Middle East.

At 10:20 am in Singapore (0220 GMT), ICE Brent October futures ticked up 3 cents/b (0.05%) from Wednesday's settle at $60.33/b, while the front-month NYMEX October light sweet crude futures moved 12 cents/b (0.21%) higher at $55.80/b.

US crude inventories for the week ended August 16 were down 2.73 million barrels, according to data released by the US Energy Information Administration on Wednesday.

Although the report was bullish for US crude inventories, price rise was muted as the drawdown was less than what analysts expected. Analysts surveyed Monday by S&P Global Platts were looking for US crude inventories for the same period to have declined by around 3.1 million barrels.

The EIA also reported that US distillate inventories were up 2.61 million barrels and US gasoline inventories were up 310,000 barrels to 234.07 million barrels last week.

"Stockpiles of diesel and similar distillates [in the US] grew by 2.61 million barrels last week, which was significantly larger than the market had been expecting," said ANZ analysts in a note Thursday.

Meanwhile, market participants would be watching out for renewed geopolitical risks in the Middle East, said analysts.

Iran's leaders have once again warned that maritime security will remain at risk if its oil exports continue to be compromised as the US warns countries of assisting the Iranian tanker Adrian Darya 1 as its sails in the Mediterranean after having been released by the Gibraltar authorities.

The Adrian Darya 1, formerly known as Grace 1, was released by Gibraltar, more than a month after being seized on suspicion of attempting to deliver oil to Syria. A US request to seize the tanker on different grounds was later rejected by Gibraltar.

The US Secretary of State Mike Pompeo subsequently threatened sanctions on any country that allows the tanker to dock at its ports.

"The world's powers know that in the case of full sanctions of Iran's oil and if its oil exports is brought down to zero, international waterways cannot have that security they used to have in the past," Iran's President Hassan Rouhani was quoted as saying Wednesday by the official news agency IRNA, at a cabinet meeting with Supreme Leader Ali Khamenei.

"Therefore, unilateral pressure against Iran cannot be in their interest and will not guarantee their security," he added.

All eyes are on the tanker as it makes its way eastward a few days after its departure from Gibraltar.

As of 0220 GMT, the US Dollar Index was up 0.15% at 98.195.

--Avantika Ramesh, avantika.ramesh@spglobal.com

--Edited by Nurul Darni, nurul.indriani.darni@spglobal.com