Oil prices reached a six-week high on Thursday as oil rigs were evacuated before a storm in the Gulf of Mexico, while tensions in the region were featured in an incident with a British tanker in the Middle East.
Brent crude futures overturned early losses and early trading increased by 40 cents to $67.41 a barrel. They hit their highest at $67.65 since May 30 earlier in the session.
U.S. West Texas Intermediate crude futures were up 33 cents, a barrel of $60.76, having previously reached their peak at $60.94 since May 23. In the earlier session, they accomplished 4.5 percent.
A day after Iran warned Britain would face “consequences” over the seizure of an Iranian oil tanker, the British government said three Iranian ships were trying to block the passage of a British vessel operated by BP through the Hormuz Strait.
After warnings from a British warship, they withdrew.
“What happened was partially expected. We pointed out last week that Iran was likely to do something of the sort,” Petromatrix oil analyst Olivier Jakob said.
“They might have created a little bit of disturbance, but nothing came out of it. For now, we are in the process of intimidation and psychological warfare…. To have a strong price reaction you need something to really happen.”
Oil prices were also backed by a decrease in U.S. stocks. U.S. crude stocks dropped 9.5 million barrels a week to July 5, the Energy Information Administration (EIA) said.
U.S. oil producers on Wednesday also cut nearly a third of their production in the Gulf of Mexico ahead of what could be one of the Atlantic hurricane season’s first major storms.
According to a U.S. regulator, 15 production platforms and four rigs were evacuated in the north-central Gulf of Mexico as oil companies relocated employees to safety ahead of a storm anticipated to become a hurricane by Friday.