Oil futures eked out a gain Friday, as traders remained wary of staking out large positions following inconclusive talks with Iran and a long weekend in the U.S.
Light, sweet crude for July delivery settled 20 cents, or 0.2%, higher at $90.86 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange settled 28 cents higher, or up 0.3%, at $106.83 a barrel.
Futures squeezed out a modest gain after spending most of the session little changed, with trading light ahead of the long Memorial Day weekend in the U.S. A two-day meeting in Baghdad between Iran and major world powers over Tehran's nuclear program produced no breakthroughs, although additional talks are scheduled in Moscow next month.
With few developments out of Iran and the market awaiting additional news on the fate of the euro zone, prices have likely found a new trading range between $85 and $95 a barrel for the near term, said Rich Rafferty, oil broker at Penson Futures.
"I think you'll see a little consolidation from here on out," he said. "But you still have the European concern and the fear that Greece goes down, which they probably will."
Iran has faced increasingly stringent sanctions over its nuclear program, which Western countries fear is aimed at developing a nuclear weapon. The escalating tensions were a major factor behind oil's rise earlier this year to nearly $110 a barrel, although prices have cooled off considerably since official talks began with a meeting in Istanbul last month.
A fresh round of talks between Iran, Russia, the U.S., China, the U.K. and France is scheduled to take place in Moscow on June 18-19.
Despite Friday's gain, benchmark futures on the Nymex fell 1% this week, largely amid concerns about Greece's possible exit from the euro zone. Oil market watchers fear that a Greek exit will destabilize the currency union, ultimately denting economic growth and curbing oil demand.
"If something happens in Europe, all bets are off. This crude oil is going lower," said Mark Waggoner, president of Excel Futures in Bend, Ore.
However, prices have the potential to go higher, Waggoner said, assuming the U.S. economy continues its recent pick-up. Although Europe continues to show weakness, the U.S. remains the world's biggest oil consumer and demand there is a major driver of prices.
Friday saw a better-than-expected reading on U.S. consumer confidence. The Reuters/University of Michigan consumer sentiment index indicated that domestic consumers are more upbeat than they have been since the most recent U.S. recession.
"We're at a support level right here," Waggoner said. "I think demand is going to pick up and we're going to go up."
Front-month June reformulated gasoline blendstock, or RBOB, settled 1.64 cent, or 0.6%, higher at $2.8929 a gallon. June heating oil settled 0.69 cent, or 0.2%, higher at $2.8288 a gallon.
More information on settlements and highs and lows for futures on Nymex and ICE platforms can be found by searching for the following headlines:
Nymex Light Crude Oil Close
Nymex Harbor RBOB Gasoline Close
Nymex Heating Oil Close
ICE Brent Crude Oil Close
ICE Gas Oil Close
-By Dan Strumpf, Dow Jones Newswires; 212-416-2818; firstname.lastname@example.org