Brent crude firms on drop in U.S. oil inventories, Iran threat

Brent oil rose on Wednesday, driven higher by a threat from an Iranian commander and a drop in U.S. crude inventories for the second week in a row.

The price rose above $78 a barrel after an Iranian Revolutionary Guards commander said he was ready to prevent regional crude exports if Iranian oil sales were banned by the United States.

The most-active Brent futures contract for September delivery settled up 48 cents at $78.24 per barrel. U.S. crude futures were up 19 cents at $74.33 a barrel, within sight of Tuesday's 3-1/2-year high above $75 a barrel. The U.S. market will not have a settlement price due to the U.S. Independence Day holiday.

Iranian President Hassan Rouhani appeared on Tuesday to threaten to disrupt oil shipments from neighboring states if Washington continued to press all countries to stop buying Iranian oil.

Looming U.S. sanctions on Iranian crude exports, force majeure in Libya and unplanned pipeline outages in Nigeria have been clouding the supply outlook despite rising output by the Organization of the Petroleum Exporting Countries.

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