Increasing supplies of oil pulled down the price of the energy commodity to its lowest value in six weeks on Tuesday, according to published reports.
After crude oil futures dropped on Monday, West Texas Intermediate futures continued the losses during the trading session on Tuesday, Bloomberg reports.
"The market is oversupplied, which is putting pressure on WTI," analyst Carsten Fritsch with Commerzbank in Frankfurt told Bloomberg. "But fears of supply disruption are keeping Brent supported. The widening of the spread is the constant factor in the market."
The median estimate of a survey administered by the news service indicates inventories of U.S. crude oil were likely to have increased by 2.5 million barrels for the week ended February 3, prior to the U.S. Energy Department releasing its report on Wednesday.
Stockpiles for crude oil "are not considered low and we therefore see some downward pressure on WTI," senior principal Victor Shum with consultancy Purvin & Gertz of Singapore told the news service. "That's why prices are below $100."
But Dow Jones Newswires reports varying strains of the energy commodity travelled in opposite directions during early trading on Tuesday. North Sea Brent drove higher in value amid anticipated troubles with shipments of the commodity from oil-rich Iran.
The Middle Eastern nation is advancing its nuclear program, to the chagrin of western nations that suspect it of attempting to develop an arsenal of nuclear weapons. Thus, sanctions have been administered against the nation and its exports of oil.
To compensate for those sanctions, refiners of oil that are situated in Europe and Asia are assembling options to oil coming from Iran.
Sweet crude oil futures were 41 cents lower in New York while North Sea Brent hurtled 70 cents higher, according to Dow Jones Newswires.
The sanctions levied by the European Union and the U.S. have prompted purchasers of crude oil to consider buying it elsewhere, which does its part to bolster the price of oil.
"It seems that when people want to buy, they buy Brent and when they want to sell, they sell WTI," director Tom Bentz with BNP Paribas Prime Brokerage told Dow Jones Newswires. "A lot of players are having to scramble for oil and WTI really has nothing to do with the rest of the world's crude right now."
Reuters reports the price of Brent crude oil shot higher than $116 per barrel early during Tuesday's trading session, attributing the climb to threats by Iran to cut off exports of the energy commodity to some European nations. But the ongoing euro zone debt dilemma tearing through Greece tempered gains of the energy commodity.
Though the European Union's sanctions on oil shipped from Iran are scheduled to commence on July 1, Reuters cites an English-language report from Iran stating the Middle Easter nation's parliament is prepared to execute restrictions of oil shipments to some European countries.
Across the Atlantic, U.S. President Barack Obama joined in on pinching Iran by endowing U.S. banks with powers to freeze assets connected with the government of Iran. The White House action also is geared toward the central bank of Iran.
Shifting southeast, struggles for control of the oil industry between South Sudan and Sudan is impacting the price of the energy commodity. In July of last year, South Sudan voted to secede and it took with it 75 percent of oil produced but now needs to account for its use of pipelines that pass through the north as well as Port Sudan on the Red Sea.
As a consequence, South Sudan has shuttered what should be the daily production of 350,000 barrels of crude oil, according to Reuters.
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