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West Texas Intermediate and Brent crudes fell on signs that the insurgency in Iraq won't curb output and as U.S. stockpiles climbed.
Iraq's crude exports will rise next month, Oil Minister Abdul Kareem al-Luaibi said yesterday. Government forces repelled an attack by the Sunni Islamic State in Iraq and the Levant on the Baiji refinery north of Baghdad. U.S. crude stockpiles rose by 1.74 million barrels to 388.1 million last week, the Energy Information Administration said yesterday.
"Prices are retreating because the insurgency hasn't had a material impact on the Iraqi production and we might be looking at a gain in exports," said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. "Prices are consolidating here just below the nine-month highs."
WTI for August delivery slipped $1.23, or 1.2 percent, to $105.27 a barrel at 10:51 a.m. on the New York Mercantile Exchange. The volume of all futures traded was 7.5 percent below the 100-day average for the time of day. Futures are up 7 percent this year.
Brent for August settlement fell 74 cents, or 0.6 percent, to $113.26 a barrel on the London-based ICE Futures Europe exchange. Futures slipped to $113.11, the lowest level since June 18. Trading volume was 4.5 percent than the 100-day average. Prices have increased 2.2 percent this year.
The European benchmark crude traded at a $7.99 discount to WTI, up from $7.50 yesterday.
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