The muted price reaction to Thursday's oil tanker attacks near the Strait of Hormuz shows that the oil market is stable as long as production continues at current levels, US Deputy Secretary Dan Brouillette said Saturday on the sidelines of the G20 energy meetings in Japan.
"There was a slight uptick in pricing for a short amount of time, but it came right back [down]," Brouillette said during a press conference.
"What that says to the world as well as all the G20 participants is that the markets are stable. As long as oil production continues where it is, as long as we continue to innovate, as long as we continue to develop new energy technologies, I think we'll continue to see that resilience of our energy markets."
Crude futures settled higher Friday as supply concerns stemming from the oil tanker attacks appeared to overshadow weaker global oil demand growth. August ICE Brent futures settled 70 cents higher at $62.01/b, while July NYMEX light sweet crude settled up 23 cents at $52.51/b.
Earlier, crude futures had been lower as the market seemed to pull back from Thursday's reaction following the attacks on two oil tankers near the Strait of Hormuz.
The Thursday attack on two tankers had so far resulted in no supply side constraints in the Persian Gulf, which many initially feared, as neither tanker was said to be holding any crude and the Strait of Hormuz remained open for safe passage.
Brouillette said the US condemns the attacks. He said the incident and concerns about energy security have been a major topic of discussion among G20 delegates.
