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Brent, WTI down 12% this week, most since March 2023

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No major supply disruption from Mideast crisis, analysts

say

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Lower US inventories lend some price support

(Updates prices)

By Siyi Liu

SINGAPORE, June 27 (Reuters) - Oil prices headed for

their steepest weekly decline since March 2023 on Friday, as the

absence of significant supply disruption from the Iran-Israel

conflict saw any risk premium evaporate.

Brent crude futures rose 36 cents, or 0.53%, to

$68.09 a barrel by 0637 GMT while U.S. West Texas Intermediate

crude gained 33 cents, or 0.51%, to $65.57. That put both

contracts on course for a weekly fall of about 12%.

The benchmarks are now back at the levels they were at

before Israel began the conflict by firing missiles at Iranian

military and nuclear targets on June 13.

This week began with prices hitting a five-month high after

the U.S. attacked Iranian nuclear sites at the weekend, before

slumping to their lowest in over a week on Tuesday when U.S.

President Donald Trump announced an Iran-Israel ceasefire.

At present, traders and analysts said they could see no

material impact from the crisis on oil flows.

"Absent the threat of significant supply disruption, we

still view oil as fundamentally oversupplied, with our 2025

balances indicating a roughly 2.1 million barrels per day (bpd)

surplus," Macquarie analysts wrote in a research note on

Thursday.

The analysts forecast WTI to average around $67 a barrel

this year and $60 next year, raising each forecast by $2 after

factoring in a geopolitical risk premium.

Small gains in prices later in the week came as U.S.

government data showed crude oil and fuel inventories fell a

week earlier, with refining activity and demand rising.

"The market is starting to digest the fact that crude oil

inventories are very tight all of a sudden," said Phil Flynn,

senior analyst at the Price Futures Group.

Also supporting prices was a Wall Street Journal report that

Trump planned to choose the next Federal Reserve chief earlier

than usual. That fuelled fresh bets on U.S. interest rate cuts,

which would typically stimulate demand for oil.