Oil prices were flat on Thursday, supported by strong US economic data that offset investor worries about the possibility of an increase in Iranian supplies.
Brent fell 2 cents to $ 68.85 a barrel at 10:52 a.m. EDT (2:52 p.m. GMT). US West Texas Intermediate (WTI) crude was unchanged at $ 66.21 per barrel.
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The U.S. economy, which in the first quarter recorded its second fastest growth rate since the third quarter of 2003, is gaining momentum, with other data on Thursday showing business spending on equipment accelerated in April.
“It gave us a riskier stance in the markets,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. “We are back to focusing on supply and demand.”
Prices have been weighed down by the threat of reintegration of Iranian supplies into the market. Iran and world powers have been negotiating since April to determine how Tehran and Washington should secure the lifting of sanctions against Iran, including its energy sector, in return for Iran complying with restrictions on its nuclear activities.
These talks will be a major issue for a June 1 meeting of the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC +. Producers will need to assess whether to change plans to ease production in light of the prospect of additional Iranian supplies.
Analysts said any increase in supply from Iran will be gradual, with JP Morgan estimating Iran could add 500,000 barrels per day (b / d) by the end of this year and 500,000 b / d additional by August 2022.
Concerns also remain about demand in India, the world’s third-largest consumer of oil. India has been hit hard by the coronavirus, and only around 3% of its population has been fully vaccinated, according to the Reuters vaccine tracking.
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