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Brent oil futures hit 9-month low with Ukraine, Iraq in focus

Published 08/12/2014, 03:14 AM
Brent oil drops to 9-month low as Ukraine, Iraq tensions ease
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Investing.com - Brent oil futures tumbled to a nine-month low on Tuesday, as market players awaited new developments from Ukraine and the Middle East.

On the ICE Futures Exchange in London, Brent oil for September delivery fell 0.47%, or 49 cents, to trade at $104.19 a barrel during European morning hours.

The September Brent contract hit a session low of $103.63 earlier, the weakest level since November 8.

Meanwhile, the more actively-traded October contract slumped 0.79%, or 83 cents, to trade at $104.56.

In Ukraine, a Russian convoy of 280 trucks carrying humanitarian aid set off on Tuesday amid Western warnings against using help as a pretext for an invasion.

Meanwhile, investors also monitored developments in Iraq, where the U.S. recently began air strikes targeting jihadi militants from the Islamic State insurgent group in the northern part of the country.

Market analysts said U.S. airstrikes might lower the risk of oil supply disruptions from the country.

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

Elsewhere, Israel and Hamas agreed to a fresh 72-hour ceasefire in Gaza on Sunday, following a month of violence in the Hamas-ruled territory.

Meanwhile, on the New York Mercantile Exchange, crude oil for delivery in September sank 0.98%, or 96 cents, to trade at $97.12 a barrel.

Traders awaited key U.S. weekly supply data to gauge the strength of oil demand from the world’s largest consumer.

The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles fell by 2.2 million barrels in the week ended August 15.

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