Crude fell 1.8% in London, and West Texas Intermediate oil was little changed in New York. A nuclear deal between Iran and world powers may be implemented by the time markets open Jan. 18, triggering sanctions relief for the Islamic Republic that paves the way for a surge in oil exports. Fuel prices tumbled after Energy Information Administration data showed U.S. gasoline supplies capped the biggest two-week gain on record.
"The spread between Brent and WTI is coming in because Iranian sanctions could be lifted as early as [Jan. 18]," said Bob Yawger, director of the futures division at Mizuho Securities USA in New York. "Additional Iranian barrels will have a much bigger impact on seaborne Brent than on WTI."
Futures in London have lost 19% this year as volatility in Chinese markets fueled a rout in global equities and on speculation that growing Iranian shipments will add to the global glut.
Brent oil slipped 55 cents, or 1.8%, to $30.31 a barrel on the London-based ICE Futures Europe exchange Jan. 12. It was the lowest close since April 2004. The contract touched $29.96. Total volume traded was 89% above the 100-day average at 3:18 p.m.
West Texas Intermediate crude for February delivery rose 4 cents to settle at $30.48 a barrel on the New York Mercantile Exchange. The contract sank to $29.93 on Jan. 12, the lowest since 2003. The U.S. benchmark crude closed at a 17-cent premium to Brent, up from a 42-cent discount at Jan. 12's close.