West Texas Intermediate crude futures on the New York market closed up $1.04, or 1.16%, at $90.42 a barrel, after signs that negotiations to end the war between the United States and Iran remain stalled, which could keep global oil supply in a state of gridlock. Meanwhile, November-delivery Brent crude rose 94 cents, or 0.92%, to close at $103.53 a barrel. Over the course of September, Brent crude gained about 14%, its largest monthly increase since July of this year, while WTI crude rose about 5%. US President Donald Trump denied reports by Axios and CNN citing US officials that he was ready to ease sanctions on Iran and unfreeze Iranian funds in exchange for reaching a nuclear agreement. Oil prices also drew support from a report by the US Energy Information Administration, or EIA, showing that gasoline inventories fell by 1.6 million barrels, more than the 500,000-barrel decline analysts had expected, and distillate inventories fell by 2.2 million barrels, more than the expected decline of just 200,000 barrels, even though crude inventories rose by 922,000 barrels, contrary to analysts' expectations of a 700,000-barrel decline. In addition, US inflation figures came in below expectations, with the headline PCE index up 3.4% and the core PCE index up 3.0% year on year, helping reduce the odds that the Federal Reserve will raise interest rates again in October. The CME Group's FedWatch Tool indicates that investors are pricing in only a 37% chance that the Fed will raise rates by 0.25% at its October meeting, down from 51% on Tuesday and from 71% last week. Meanwhile, investors are watching the meeting of the Organization of the Petroleum Exporting Countries and its allies, or OPEC+, on Sunday, October 4, with the market expecting OPEC+ to keep its crude oil production quota for November unchanged.
Stalled Iran-US negotiations threaten continued supply constraints, lifting Brent crude.
Iran-US talks stalled, keeping oil supply gridlocked and supporting WTI prices.
