UPDATE 7-Oil hits two-year highs on rising demand expectations

Reuters

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    * U.S. drops sanctions on former Iranian officials in
routine step
    * U.S. unemployment claims fell to lowest in nearly 15
months

 (Adds closing prices, quote)
    By Scott DiSavino
    NEW YORK, June 10 (Reuters) - Oil prices edged up to their
highest in over two years in volatile trade on Thursday, on
optimism for strong economic demand after new U.S. unemployment
claims fell to their lowest since the country's first wave of
COVID-19 last year.
    The market shook off a brief plunge after media reports
suggested the United States lifted sanctions on Iranian oil
officials. 
    The U.S. Treasury later said it had removed sanctions on
three former Iranian officials and on two companies previously
involved in trading Iranian petrochemical products. A U.S.
official told Reuters that the activity was "routine" and not
related to talks with Iran over reviving the 2015 deal to
restrict its nuclear weapons development.  urn:newsml:reuters.com:*:nL2N2NS2E2
    Brent futures  LCOc1  rose 30 cents, or 0.4%, to settle at
$72.52 a barrel, while U.S. West Texas Intermediate (WTI) crude
 CLc1  rose 33 cents, or 0.5%, to end at $70.29.
    Those were the highest closes for Brent since May 2019 and
WTI since October 2018.
    The number of Americans filing new claims for unemployment
benefits fell last week to the lowest level in nearly 15 months,
while consumer prices increased solidly in May as the pandemic's
grip on the economy continues to ease.  urn:newsml:reuters.com:*:nL2N2NR2Q5
    "The recent unemployment and labor data published in the
(United States) are a definite positive sign that the recovery
in the country is speeding up," Louise Dickson, analyst at
Rystad Energy, said.
    "More business activity means more energy consumption, and a
better economy is a needed prerequisite for road and air traffic
to increase."
    The Organization of the Petroleum Exporting Countries said
oil demand would rise by 6.6%, or 5.95 million barrels per day
(bpd), this year. The monthly forecast was unchanged for a
second consecutive month.  urn:newsml:reuters.com:*:nL2N2NS16P
    "Oil prices are still grinding higher. The demand outlook
continues to strengthen and supplies are not necessarily keeping
up," said John Kilduff, partner at Again Capital LLC in New
York. 
    Kilduff noted, however, that the market was "priced to
perfection in relative tightness," and said Thursday's brief
midday price drop shows what can happen if Iran or OPEC+ add
more barrels to global supplies.
    OPEC+ is an alliance between OPEC and other producers
including Russia.
    Analysts have said Iran could provide about 1 million to 2
million barrels per day (bpd) in additional oil supply if a deal
is struck and sanctions lifted.  urn:newsml:reuters.com:*:nL2N2NR1UW

 (Additional reporting by Julia Payne in London and Jessica
Jaganathan in Singapore; Editing by Marguerita Choy and David
Gregorio)
 ((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters
Messaging: scott.disavino.thomsonreuters.com@reuters.net))

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