Crude Oil Ends Lower As Iran Deal Nears

(RTTNews) - U.S. crude oil ended lower for a third straight session Monday, on concerns of a supply glut after talks between Iran and the West neared a deal, even as worries over Greece eased after a last-minute deal with creditors.

Investors remained concerned over a supply glut in global markets, as a deal between Iran and the West neared conclusion. An agreement could materialize late Monday but it is yet to be seen what the conditions would be for immediately lifting sanctions.

Eurozone leaders unanimously reached an agreement early Monday to start talks for a EUR 82-86 billion third bailout program for Greece after hours of negotiations, empowering the country to battle a severe economic crisis and remain in the single currency bloc. Greece needs EUR 7 billion by July 20 and an extra EUR 5 billion by August.

European Council President Donald Tusk said, "EuroSummit has unanimously reached agreement. All ready to go for ESM [European Stability Mechanism] program for Greece with serious reforms & financial support."

Traders also mulled over the latest forecast by the International Energy Agency that indicates some slowing demand for crude oil next year. The International Energy Agency has forecast global oil demand growth to slow to 1.2 million barrels a day in 2016, compared to an average of 1.4 million barrels a day this year.

Light Sweet Crude Oil futures for August delivery, the most actively traded contract, fell $0.54 or 1.0 percent, to settle at $52.20 a barrel on the New York Mercantile Exchange Monday.

Crude prices for August delivery scaled a high of $53.17 a barrel intraday and a low of $51.26.

On Thursday, crude oil prices edged down $0.04, to settle at $52.74 a barrel, on demand growth concerns after the International Energy Agency's latest forecast showed waning demand for crude oil next year. The agency also warned of a drop in prices as Iran re-enters the market.

In economic news, the U.S. recorded a budget surplus of $52 billion in June, which is about $19 billion lower than the surplus seen a year ago. Economists expected a surplus of $51 billion.

Elsewhere, Chinese exports increased at a faster-than-expected pace in June, while imports fell less-than-expected, official data showed Monday. Exports rose 2.8 percent year-over-year in June, exceeding economists' expectations for 1.0 percent growth.

Meanwhile, imports slid 6.1 percent in June from the previous year, much slower than the 15.5 percent sharp decline expected by economists. China's trade surplus came in at $46.54 billion in June, compared to the surplus of $59.49 billion in May. Economists expected a surplus of $56.7 billion in June.

Japan's industrial production dropped less than initially estimated in May, data from the Ministry of Economy, Trade and Industry showed Monday. Industrial production declined a seasonally adjusted 2.1 percent month-over-month in May, revised down from a 2.2 percent drop in the flash data. In April, production had risen 1.2 percent. Shipments in May decreased 1.9 percent from the previous month, came in line with preliminary report.