WASHINGTON (AFX) - A relatively weak storm hundreds of miles south of Puerto Rico captured the attention of energy traders Friday, sending oil and natural-gas prices higher on fears that it could strengthen and threaten Gulf of Mexico production by next week.
World energy markets also remained focused on Iran's stand-off with the West over its nuclear program.
Oil prices fell earlier in the week after U.S. Department of Energy weekly data showed a rise in gasoline stockpiles, but heading into the weekend traders seemed nervous about the possibility that a tropical depression with winds of about 35 miles per hour could look more menacing by next week.
Early Friday, the tropical depression had maximum sustained winds near 35 mph, below tropical storm strength of 39 mph, according to the National Hurricane Center in Miami. It was expected to become Tropical Storm Ernesto later Friday.
'The threat is, at best, nebulous, but memories are still raw from last year's storm damage,' Fimat USA broker Mike Fitzpatrick wrote.
Light sweet crude for October delivery rose $1.19 to $73.55 a barrel on the New York Mercantile Exchange, where natural gas futures climbed 39 cents to $7.47 per 1,000 cubic feet and gasoline futures rose more than 5 cents to $1.91 a gallon.
On London's ICE Futures exchange, October Brent crude rose 91 cents to $73.61 a barrel.
'The Iranian nuclear issue will keep a floor under prices for a long time, and we are entering into the peak of the U.S. hurricane season,' said Victor Shum, an analyst at Purvin & Gertz in Singapore.
Traders are concerned about the possibility of Iran, the world's fourth-biggest oil producer, blocking oil exports if it's sanctioned by the United Nations over its nuclear program. The U.N. set an Aug. 31 deadline for Iran to halt its nuclear program but Tehran said Tuesday that it wants to negotiate further.
The United States said Iran's response fell far short of U.N. Security Council demands it halt uranium enrichment.
Associated Press writer George Jahn contributed to this report from Vienna, Austria.
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