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Crude oil futures hold steady, Iraq still in focus

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Investing.com -

Investing.com - Crude oil futures held steady on Friday, still hovering near nine-month highs as ongoing concerns over possible supply disruptions in Iraq continued to support demand for the commodity.

On the New York Mercantile Exchange,U.S. crude oil for delivery in August traded at $106.08 a barrel during European morning trade, up 0.02%.

Prices gained 0.44% on Thursday to settle at $106.05.

Futures were likely to find support at $105.11 a barrel, Thursday's low and resistance at $106.79, the high from June 16.

Concerns about potential supply disruptions due to fighting in Iraq persisted, as the conflict between Sunni Islamist insurgents and Iraqi army forces continued on Friday.

Fighting in the Iraqi city of Baquba, located to the northeast of Baghdad, shut down the country's biggest oil refinery on Wednesday.

U.S. President Barack Obama said on Thursday that he was sending up to 300 U.S. military advisers to Iraq and that he was prepared to take "targeted" military action later if deemed necessary.

Iraq produced approximately 3.5 million barrels a day of oil last month, making it OPEC's second-biggest oil producer behind Saudi Arabia.

Meanwhile, markets were still digesting the fact that the Federal Reserve gave no indication of when interest rates could start to rise at the conclusion of its two-day meeting on Wednesday. In addition, the Fed's forecast of where interest rates might reach in the long term fell from 4% to 3.75%.

The central bank cut its bond purchases by $10 billion a month, to $35 billion, saying there was "sufficient underlying strength" in the U.S. economy to continue tapering.

Markets seemed to shrug off data on Thursday showing that U.S. jobless claims fell more than expected last week, as well as a separate report showing that manufacturing activity in the Philadelphia area expanded at the fastest rate in eight months in June.

Elsewhere, on the ICE Futures Exchange, Brent oil for August delivery dipped 0.03% to trade at $114.99 a barrel, with the spread between the Brent and crude contracts standing at $8.91 a barrel.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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