Oil Prices rose 2% on Friday after three days of losses, pushed higher by a storm in the Gulf of Mexico. Still, investors were bracing for the return of Iranian crude supplies after officials said Iran and world powers had made progress on a nuclear agreement. Brent crude futures rose $1.33, or 2%, to $66.44 a barrel, while West Texas Intermediate crude futures rose $1.64, or 2.65%, to $63.54 a barrel.
The National Hurricane Center (NHC) in the United States said on Friday that a weather system developing over the western Gulf of Mexico has a 40% chance of becoming a cyclone in the next 48 hours. In Chicago, Phil Flynn, the senior analyst at Price Futures Group, said, “This early storm prompted traders to buy crude ahead of the weekend in anticipation of potential production shut-ins.”
Expectations restricted the gains that Iran could increase oil output by a million barrels per day or more later this summer. After Iran’s president, Hassan Rouhani, said the US was ready to lift sanctions on his country’s energy, banking, and shipping sectors, the two contracts dropped nearly 3% on the week.
For the fourth week in a row, US energy companies added oil and natural gas rigs, as higher Oil Prices inspire some drillers to return to the excellent pad. The oil and gas rig count, a leading indicator of potential production, increased by two to 455 in the week ending May 21, the highest level since April 2020, according to Baker Hughes Co, an energy services company.
Iran and world powers have been in negotiations to revive the 2015 agreement since April. The European Union official heading the talks said that he was sure a compromise would be reached on Wednesday.