Oil prices book monthly gains as Middle East fears simmer

By William Watts

Oil futures ended higher Friday, booking monthly gains as investors continued to fret over the possibility of a wider Middle East conflict that could threaten flows of crude out of the region.

Price moves

West Texas Intermediate crude CL00 for August delivery CL.1 CLQ24 declined 20 cents, or 0.2%, to end at $81.54 a barrel on the New York Mercantile Exchange, but logged a June rise of 5.9%.August Brent crude BRNQ24, the global benchmark, expired at $86.41 a barrel on ICE Futures Europe, ending with a gain of 2 cents. Brent, based on front-month activity, saw a June rise of 1.2%. The more actively traded September contract BRN00 BRNU24, which now becomes the front month, fell 26 cents, or 0.3%, to close at $85 a barrel. July gasoline RBN24 fell 0.7% to finish at $2.529 a gallon, while July heating oil shed 1.2% to $2.517 a gallon.August natural gas NGQ24 dropped 3.1% to close at $2.601 per million British thermal units.

Market drivers

Continued exchanges of fire over the Lebanon border between Israel and Iran-backed Hezbollah have heightened fears of an all-out war.

"While the ignition of that front may ignite other fronts in the region more than before, whether in Iraq, Syria, or the Red Sea, it is not unlikely that Iran will enter directly into this conflict," said Samer Hasn, market analyst at XS.com.

"In other words, the coming weeks may witness a large-scale regional war if these fears are correct, and this would constitute widespread disruption to many oil supply lines," Hasn wrote.

-William Watts

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06-28-24 1612ET

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