Oil Trades Near 8-Month High on Demand, Iran Tension Amid Shrinking Supply

Oil traded near the highest in almost eight months as investors speculated that tensions over Iran, shrinking U.S. crude stockpiles and signs of economic recovery will tighten global supplies.

Futures were little changed after rallying 4.2 percent yesterday as the head of Iran’s army warned the U.S. against sending an aircraft carrier back to the Persian Gulf. Manufacturing in the U.S., the world’s largest economy, expanded at the fastest pace in six months, adding to improved factory activity in Asia and Europe. Crude inventories probably dropped 500,000 barrels last week, according to a Bloomberg News survey before an Energy Department report tomorrow.

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