Crude oil futures advance as Iran meetings approach

Crude oil futures gained in value on Monday for the first trading session in seven, propelled by the commitment of China to develop its economy, according to Bloomberg.

Also driving the price of the energy commodity higher on Monday was investment house Goldman Sachs Group noting that supply and demand of crude oil is tightening. The firm also noted that the recent downward drive of crude oil was overdone.

The Asian nation, the globe's second largest consumer of the energy commodity and host the world's second largest economic system, is devoting more effort to enhancing economic development and growth, according to state news service Xinhua News Agency, which quoted Premier Wen Jiabao.

"Chinese growth continues to be sustained and robust," senior broker Christopher Bellew with Jefferies Bache in London told the news service. "The emphasis for oil prices is ultimately where demand is growing the most strongly, such as China and India. Prices seem to have found a bottom at last."

At 9:53 a.m. on Monday, crude oil futures gained 0.74 percent, a 79 cent lift to $107.93 per barrel.

On Friday, the energy commodity endured drops of 1.2 percent and prices thus far this year are down roughly 7 percent.

But, despite the losses, a research head at Goldman Sachs noted demand will grow.

"Despite concerns over the softening economic data, oil demand continues to improve," states a report authored by energy research head David Greely with Goldman Sachs in New York, according to Bloomberg. "The supply of oil actually available to the market is increasingly constrained by the inability of Iran to market its oil owing to the effects of U.S. and European sanctions."

He also pointed to commentary from the oil minister of Saudi Arabia, the highest-producing nation of the Organization of the Petroleum Exporting Countries. The production from Saudi Arabia grew to its second-highest point in more than 30 years this past March in anticipation of an embargo applied by Europe against Iran, which is set to begin in July.

"With Saudi ramping up production to meet the need for oil once sanctions against Iran come into full effect, the oil market was pushed into surplus this year," the energy research head said, according to Bloomberg. "However, as Iranian supplies are increasingly shut out from the market as the sanctions take effect, that surplus is disappearing."

Dow Jones Newswires reports the energy commodity was hinging on meetings scheduled for this Wednesday between officials in Iran and the five permanent members of the U.N. Security Council and Germany.

The oil-rich Middle Eastern nation drew sanctions over its nuclear program, which Western nations worry is designed to develop weapons. This month's meetings are in Baghdad while last month they convened in Istanbul.

But on Monday, Yukiya Amano, head of the International Atomic Energy Agency, made an unannounced visit to Iran, ahead of Wednesday's meetings.

"We think Brent prices may receive some support ahead of the second round of nuclear talks with Iran this Wednesday. However, we would expect oil prices to remain under pressure due to European debt concerns," states a note authored by ANZ, according to Dow Jones Newswires.

Reuters reports SK Energy, the largest refiner of oil in South Korea, is set to cut off imports of Iranian crude once the European Union ban is implemented on July 1. That would be the first of the Middle Eastern nation's big buyers from Asia to act on the embargo.

"SK Energy won't lift Iranian crude oil after lifting a 2 million barrel cargo in early June," one of two informed sources told Reuters. "SK Energy will not import Iranian oil for July arrival."