Oil futures edged higher Tuesday, trading around multiyear highs, with support tied to expectations supplies will remain tight.
West Texas Intermediate crude for December delivery
rose 25 cents, or 0.3%, to $84.01 a barrel on the New York Mercantile Exchange. The U.S. benchmark traded at a seven-year high above $85 a barrel on Monday before ending the day unchanged.
the most actively traded contract, rose 22 cents, or 0.3%, to $85.39 a barrel.
A softer tone during Monday’s session was tied by some to speculation about the potential revival of talks on the Iranian nuclear accord, though no official announcements have been made, noted Carsten Fritsch, commodity analyst at Commerzbank.
Meanwhile, the focus remains on tight crude supplies. Russia’s deputy prime minister, Alexander Novak, on Monday said he expected the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, next week to agree to raise output by another 400,000 barrels a day in November — in line with the timetable agreed earlier this year.
A reluctance by OPEC+ to boost production beyond its existing plans has been cited as a factor behind crude’s fall rally.
Meanwhile, natural-gas futures
pulled back, down 1.3% at $5.822 per million British thermal units after jumping nearly 12% Monday following a forecast from the National Oceanic and Atmospheric Administration predicting colder-than-normal conditions for most of the U.S. Southeast and Midwest during the first week of November.
Natural-gas prices are “being driven up by forecasts of lower temperatures in the coming two weeks and the expectation of higher LNG exports now that maintenance work has been completed at a number of liquefaction facilities,” Fritsch wrote. “Both are likely to increase demand for U.S. natural gas and result in a decline in U.S. natural gas stocks, which — shortly before the start of the heating season — are 4% below the average level of the years 2016-20.”