Oil Jumps After 4-Day Slump As Kurdistan Supply Stalls

SECAUCUS, NJ (DTN) – Oil prices rose for the first time in 5 sessions Tuesday (9/23) after a deal to resume crude exports from Iraq’s Kurdistan stalled, keeping away 230,000 bpd of Iraqi supply from a market depressed by glut concerns.

In crude oil, NYMEX-traded WTI for November gained $1.42, or 2.28%, at $63.69 bbl. ICE Brent for November delivery climbed $1.35, or 2.04%, to $67.94 bbl.

Among oil products, October RBOB gasoline futures advanced $0.02090 to $2.0075 gallon, and the front-month ULSD contract rose $0.0491 to $2.3414 gallon. The U.S. dollar index was little changed at 96.84.

WTI and Brent lost almost 3% each over the past 4 sessions, symptomatic of the general weakness the market had been over the past two months as oversupply concerns intensified and pushed geopolitical risks to the sideline.

Tuesday’s rebound provided a respite to those worries as the resumption in oil exports from Iraq’s Kurdistan to Turkey hit a snag when two primary producers insisted on receiving assurances for debt repayment.

This demand has prevented a deal from being finalized, keeping the pipeline — inactive since March 2023 — from resuming the flow of some 230,000 bpd.

Global growth in crude production has been significantly outpacing demand growth. Output increases by OPEC and non-OPEC members alike are set to lead to swelling global inventories by year-end.

The market is, meanwhile, monitoring European Union efforts to tighten sanctions on Russian oil exports at the behest of the Trump administration. The newest EU sanctions package, expected in the coming days, will add more than 100 tankers to its list of sanctioned vessels as part of Russia’s “shadow fleet”.

U.S. crude oil stockpiles are expected to have risen last week, while gasoline and distillate inventories likely fell. The market is awaiting weekly oil stock data from the American Petroleum Institute, due later on Tuesday.