Brent edges up, eyeing Iran talks, U.S. Fed

Tue Jun 19, 2012 12:05pm EDT
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By Robert Gibbons

NEW YORK (Reuters) - Brent crude edged up on Tuesday, bouncing from a 17-month low, supported along with U.S. crude by deadlocked talks to defuse the dispute over Iran's nuclear program and hopes for more monetary stimulus to spur economic growth.

Brent fell sharply before Spain managed to sell debt at its latest auction, then steadied even though the country's borrowing costs soared and the threat of a spreading debt crisis continues as Greek political parties try to form a government.

U.S. crude bounced after finding support again near the $82 a barrel level, also helped by rising equities on Wall Street. .N

Iran and six world powers blamed each other for deadlock at talks on Tehran's nuclear program as negotiators struggled for a breakthrough that will reduce the risk of a new Middle East war.

"The market has rebounded on worries about the outcome of the nuclear talks in Moscow and a general rebound in the risk sentiment," Thorbjorn bak Jensen, oil analyst with Global Risk Management, said.

The U.S. Federal Reserve's Federal Open Market Committee will release a policy statement on Wednesday at the end of a two-day meeting and there remains some hope that the Fed will unveil some form of additional stimulus to support a flagging recovery.

Brent August crude edged up 25 cents to $96.30 a barrel by 11:45 a.m. EDT (1545 GMT), after falling to $94.44, the lowest intraday price since January 10, 2011.

U.S. July crude was up 78 cents at $84.05, having traded from $82.28 to $84.41 ahead of the July contract's expiration on Wednesday.   Continued...

A worker collects crude oil sample at an oil well operated by Venezuela's state oil company PDVSA in Morichal July 28, 2011. REUTERS/Carlos Garcia Rawlins