June 8 (Reuters) – Oil prices settled lower on Thursday but rebounded from earlier losses after the US and Iran both denied a report that they were close to a nuclear deal.
Oil fell by more than USD 3 on the report that the US would give Iran sanctions relief to export oil in return for Tehran reducing uranium enrichment.
A spokesperson for the White House National Security Council called the report “false and misleading”.
Brent crude settled down 99 cents, or 1.3%, at USD 75.96 a barrel while US West Texas Intermediate crude settled down USD 1.24, or 1.7%, to USD 71.29.
“If there’s no Iran deal then we’re back where we were before, focused more on fuel demand,” said John Kilduff, partner at Again Capital LLC in New York.
Oil prices were lower earlier after the US reported a larger-than-expected rise in gasoline inventories on Wednesday. That raised concern about US fuel demand, with the peak summer driving season well underway.
Demand concerns outweighed the prospect of tighter supply after Saudi Arabia pledged at a weekend OPEC+ meeting to cut crude output by 1 million barrels per day in July. That unilateral cut was in addition to the group’s broader deal to extend existing supply curbs into 2024.
Oil prices could get a lift if the US Federal Reserve skips a rate hike at its next meeting on June 13-14, said Tamas Varga from PVM brokerage. Economists polled by Reuters expect no hike at the meeting.
The US dollar was slightly weaker on Thursday, making oil cheaper for buyers holding other currencies.
(Reporting by Laura Sanicola; Additional reporting by Jeslyn Lerh; Editing by Chris Reese, Sharon Singleton, and Lisa Shumaker)