US Oil Up On Condensate Export Approval, Brent Falls
NEW YORK, June 25 (Reuters) - U.S. crude oil inched higher on Wednesday after news of a U.S. government decision to permit exports of lightly refined oil, while Brent oil fell as fears of supply cuts from Iraq receded.
U.S. crude reversed a two-day downward trend, after U.S. federal officials approved exports of condensate, an ultra-light oil, in a marginal relaxation of a 40-year ban on U.S. oil exports.
The rally lost some momentum after weaker-than-expected data from the U.S. Energy Information Administration (EIA) pointed to a potential dip in demand growth from the world's largest oil consumer and as traders awaited some clarification of what the condensate ruling would mean for the market.
"There are still a lot of questions about how aggressive the U.S. will be in exporting condensate," said Phil Flynn, an analyst at Price Futures Group in Chicago.
Brent lost 46 cents to settle at $114.00 a barrel, as worries about sectarian violence reducing Iraqi exports seemed to fade. Brent hit a nine-month high of $115.71 last week on the fighting in Iraq.
U.S. crude gained 47 cents to settle at $106.50 a barrel. It had hit $107.50 in early trade as the market reacted to the news on U.S. condensate exports.
The spread <CL-LCO1=R> between the two benchmarks narrowed to close at $7.50, after it had widened to $9.01 last week.
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