Oil prices traded higher on Friday, extending gains of around 1.5% in the previous session, amid concerns over supply disruptions in northern Iraq.
By 3:10 pm AEST (5:10 am GMT) Brent crude futures added 33 cents or 0.5% to $69.85 per barrel, while U.S. West Texas Intermediate crude futures lifted 30 cents or 0.4%, to $67.84 per barrel.
Both benchmarks had gained around $1 on Thursday following fresh supply fears from the Middle East.
The price support came after four consecutive days of drone attacks on oil fields in Iraqi Kurdistan, which shut down roughly half the region’s oil production.
Officials estimate that output has been slashed by 140,000 to 150,000 barrels per day, out of the region’s typical 280,000 bpd.
ANZ analysts commented in a note to clients: "While OPEC+ output is rising and Saudi Arabia increased flows to 6.43mb/d in H1 July, investors still view the market as tight. Saudi Arabia’s production increased to 9.752mb/d in June in response to tension in the region.
"Iraq has lost about 200kb/d of production due to drone attacks on several fields in Kurdistan.
"The backwardated curve encourages oil buying, while the distillate market is drawing attention due to low inventories."
Despite the unrest, Iraq's federal government announced on Thursday that oil exports from Iraqi Kurdistan to Turkey will resume through a long-idled pipeline, ending a two-year halt.
In addition, expectations that major oil producers will lift supply as Northern Hemisphere summer demand tapers have also pressured prices.
