Oil prices higher following rift in Middle East
The political rift in the Middle East saw crude futures rise. Saudi Arabia and three other countries severed diplomatic ties with Qatar accusing it of supporting terrorism and meddling in internal affairs.
Oil traders are sensitive to Middle East tensions because they worry about supply disruptions, analysts have said.
Oil prices pared a gain of more than 1% seen earlier in the European session and in Asian trading. On the New York Mercantile Exchange, light, sweet crude futures for delivery in July CLN7, -0.65% recently traded at $48.02 a barrel, up 36 cents, or 0.7% in the Globex electronic session. August Brent crude LCOQ7, -0.80% on London's ICE Futures exchange rose 32 cents, or 0.6%, to $50.27 a barrel.
Maketwatch.com said that the latest developments do not appear to have had a direct impact on oil production and exports.
However all eyes will be on Qatar, a member of the Organization of the Petroleum Exporting Countries. It is yet to be seen if Qatar decides to disrupt the production cutback deal.
Oil took a beating last week by dropping more than 4%, the largest weekly decline since early May. Sentiment deteriorated further after data from industry group Baker Hughes on Friday showed U.S. oil drillers adding 11 more active rigs in the week ended June 2. That marked a 20th consecutive weekly rise, Marketwatch also reported.