Oil prices rise with focus on Greece, Iran

Oil prices rose on Monday as dealers focused on crunch Greek debt talks and a possible return of Iranian supplies to the market.

US benchmark West Texas Intermediate for July delivery gained 56 cents to $60.17 a barrel compared with Friday's close. 

Brent North Sea crude for August won 54 cents to $63.55 a barrel around  midday in London.

"Hopes that agreement could be reached in the debt dispute with Greece at today's EU summit are lending buoyancy to oil prices as the new week begins," said Commerzbank analyst Carsten Fritsch.

The heads of the 19 eurozone countries will hold an emergency summit in Brussels later Monday under pressure to prevent Greece from defaulting on its debt.

If the two sides are unable to agree to a deal, Greece will likely default on an IMF debt payment of around 1.5 billion euros ($1.7 billion) due on June 30, leading to the possibility of it crashing out of the eurozone.

Greek Prime Minister Alexis Tsipras on Sunday presented new proposals on reforming the country's bailout to European leaders, raising hopes that a default can be averted after a five-month deadlock.

Iran was also in sharp focus for oil traders and Daniel Ang, investment analyst at Phillip Futures in Singapore, said negotiations between the crude producer and world powers over Tehran's controversial nuclear program are "going to give headwind for... prices this week."

Six global powers -- Britain, China, France, Germany, Russia and the United States -- are trying to nail down a deal to curb Iran's nuclear ambitions by reducing its stockpiles of enriched uranium and mothballing some of its sites.

If the agreement is reached by June 30 and implemented subsequently, the powers have agreed to gradually scale back sanctions imposed since 2012, including on its petroleum industry.

Iran has the world's fourth-largest oil reserves but its exports have fallen from more than 2.2 million barrels per day in 2011 to about 1.3 million under the sanctions.

A return of disrupted Iranian supplies "could cause another round of oversupply" in a global market already flush with stockpiles, Ang said.

(AFP)