Oil prices edged higher on Monday as a storm formed in the Gulf of Mexico. Iran said a three-month nuclear monitoring deal had expired, raising doubts about the future of indirect talks that could end U.S. sanctions on Iranian crude exports.
Brent crude oil futures for July rose 32 cents, or 0.5%, to $66.76 a barrel by 0143 GMT.
U.S. West Texas Intermediate for July was $63.93 a barrel, up 35 cents, or 0.6%.
Oil prices fell last week after Iran’s president, Hassan Rouhani, said the United States was ready to lift sanctions on his country’s oil, banking and shipping sectors.
However, on Sunday, the speaker of Iran’s parliament said a three-month monitoring deal between Tehran and the U.N. nuclear watchdog had expired and that its access to images from inside some Iranian nuclear sites would cease.
Last week, European diplomats said that failure to agree on an extension of the monitoring deal would plunge wider, indirect talks between Washington and Tehran on reviving the 2015 Iran nuclear deal into crisis. Those talks are due to resume in Vienna this week.
Former President Donald Trump withdrew the United States from the deal in 2018 and re-imposed sanctions.
“Iran’s oil production has been rising in recent months, likely in anticipation of a lifting of the sanctions,” ANZ analysts.
The bank expects Iranian crude and condensate production to rise to 3.2 million BPD in December, from around 2.8 million BPD in the first quarter, and only reach full capacity of 4.2 million BPD in early 2023.
Meanwhile, a low-pressure system located over the western Gulf of Mexico with winds of 30-35 miles per hour (48 to 56 km per hour) near and east of the centre has a 60% chance of becoming a cyclone in the next 48 hours, the U.S. National Hurricane Center (NHC) said on Friday.
The ring coronavirus cases in Asia continue to worry investors as they affect the oil demand outlook.