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Crude futures move lower after US-led attack on Syria proves limited

New York (Platts)--15 Apr 2018 627 pm EDT/2227 GMT


Crude futures moved lower Sunday evening, giving back some of the prior week's gains after a joint attack by the US, UK and France on suspected Syrian chemical weapons facilities proved to be limited in scope.

ICE June Brent crude futures fell 47 cents to $72.11/b, while NYMEX May crude fell 37 cents to $67.02.

Crude futures had rallied over $5/b last week after US President Donald Trump threatened to bomb Syria's Bashar al-Assad regime in retaliation against suspected chemical weapons attacks.

Syria produces very little oil, but traders were concerned that a broadening conflict with Assad's supporters -- Russia and Iran -- could disrupt oil flows out of the Middle East.

COMEX gold futures also fell in Sunday evening trade. Gold for June delivery, the active contract, slipped $5.10 to $1,342.80/oz.

Gold futures were supported last week in part by the prospect of a military strike on Syria. Tenuous trade relations with China were also supportive.

The US and its allies launched attacks late Friday. US Defense Secretary Jim Mattis said in a news briefing Friday that "right now we have no additional attacks planned," although the Trump administration did not rule out additional attacks if Assad continues to use chemical weapons.

Russian President Vladimir Putin condemned the airstrike, but so far there has been no escalation of the conflict with Russian and Iranian forces.

News that Yemeni Houthi militants fired missiles toward Saudi Arabia was also bullish last week.

Global inventories have tightened, so any supply disruptions will likely have a more bullish impact on crude prices.

The International Energy Agency said Friday OECD oil stocks fell by 25.6 million barrels to 2.84 billion barrels in February, the lowest since April 2015.

(Updates with COMEX gold futures) --Jeff Mower, jeff.mower@spglobal.com

--Edited by Jason Lindquist, newsdesk@spglobal.com




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