Oil's weekly gains supported by Egypt crisis

NEW YORK: US oil futures fell as traders brushed off the threat of supply disruptions from tropical storms in the Gulf of Mexico and took profits ahead of the weekend, but Middle East concerns kept Brent futures steady.
Prices were still on track for a weekly gain as turmoil in Egypt and Libya stoked worries over oil supply security.
Brent crude oil futures for October delivery were trading 16 cents higher at $109.76 at 1657 GMT.
The contract was fairly close to touching the 10-day moving average of $108.95 on the low end of the session’s range. It fell as low as $109.17 and rose as high as $110.33.
On Thursday, the September contract expired 91 cents higher at $111.11 per barrel.
US crude oil futures for September delivery were trading 13 cents lower at $107.20 per barrel. The September crude oil contract expires on Tuesday.
US crude oil futures for October delivery were trading 18 cents lower at $107.01.
US crude oil futures put in a 16-month high on July 19 at $109.32.
There was no real “catalyst” to go above 16-month high, said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut. “This is weekend profit-taking after being up five sessions in a row.”
Still, Middle East unrest positioned crude oil futures for a weekly percentage rise and were putting a floor under prices, analysts and brokers said.
Although Egypt is not a major oil producer, investors are wary that the unrest there could spread around the Middle East, which pumps more than a third of the world’s oil.
On Thursday, concerns that the violence in Egypt could affect the Suez Canal, conduit for up to 3 million barrels per day (bpd) of oil, helped drive Brent to a four-month high. The Suez Canal and Egyptian ports were operating normally, shipping sources said.
Thousands of supporters of the ousted president took to Egyptian streets, urging a “Day of Rage” to denounce this week’s assault by security forces onprotesters.
Additionally, Libya’s oil production and exports have been crippled by violence and strikes, pushing exports to their lowest level since the civil war in 2011.
Libya has restarted refined-product exports from its largest refinery, Ras Lanuf, but most crude oil terminals, including Es Sider, the biggest, remain blocked by protests, with exports still running at less than half normal levels.
The geopolitical risk premium was supporting prices, and US economic data and stock market performance are “at best secondary, if not tertiary, drivers,” said Stephen Schork, editor of The Schork Report in Villanova, Pennsylvania.
US stocks were flat after a sharp selloff this week.
US Gulf of Mexico oil producers were monitoring the weather.
Several oil companies have shuttled some offshore personnel on to land as a broad low pressure system in the southwestern Gulf of Mexico continued to have a 50 percent change of becoming a tropical cyclone in the next 48 hours.
Brazil’s state-run oil company, Petroleo Brasileiro SA, said it evacuated and shut its Cottonwood oil and gas production field in the Gulf of Mexico in preparation for an expected tropical storm.
But the system in the Gulf “probably won’t be more than a passing day or two thing,” McGillian added.
Meantime, Erin, the fifth named storm of the 2013 Atlantic hurricane season, weakened to a tropical depression.