Oil Prices Rise Amid Uncertainty Over Iran President’s Fate

By Colleen Howe

BEIJING (Reuters) – Oil prices rose in early Asian trading on Monday, adding to last week’s gains, as rescuers searched for Iran’s president after a helicopter crashed in the oil-producing country and after the US purchased oil to help replenish the national stockpile.

Brent rose 26 cents, or 0.3%, to $84.24 a barrel by 0049 GMT. West Texas Intermediate (WTI) crude oil rose 15 cents, or 0.2%, to $80.21 a barrel.

Brent ended the previous week up around 1%, its first weekly gain in three weeks, while WTI rose 2% due to improving economic indicators in the US and China, the world’s largest oil consumers.

A helicopter carrying Iranian President Ebrahim Raisi crashed on Sunday, an Iranian official told Reuters. The lives of President Raisi and Foreign Minister Hossein Amirabdollahian were at risk, the official said.

Despite the volatility in the region, oil prices registered only slight changes.

“The oil market remains largely range-bound and without any new catalyst we will likely have to wait for clarity around OPEC+ production policy to break out of this range,” said Warren Patterson, head of commodity strategy at ING.

The Organization of the Petroleum Exporting Countries and its allies, together called OPEC+, are scheduled to meet on June 1.

“The market also appears increasingly insensitive to developments on the geopolitical front, likely due to the large amount of spare capacity that OPEC holds,” Patterson said.

The US government took advantage of the recent drop in oil prices, saying late last week that it purchased 3.3 million barrels of oil at $79.38 per barrel to help replenish its Strategic Petroleum Reserve following a massive sell-off. of stocks in 2022.

Supporting the market last week, signs of easing inflation in the US boosted expectations of interest rate cuts, which could lower the value of the dollar and make oil cheaper for holders of other currencies.

(Reporting by Colleen Howe; Editing by Sonali Paul)