What's Moving the Oil Markets?

•Bearish news weighing on the market is the expectation of large builds in US gasoline stocks in the US when the US Energy Information Agency releases it's figures on Wednesday. "With no fresh news on the Iran situation it is still ever present but there is more negative news dampening the market including the Bernanke speech," a broker said.

•Federal Reserve Chairman Ben Bernanke said the US central bank would keep a vigilant watch over rising inflation. In a speech to a conference in Washington on international monetary policy, Bernanke said the US economy was clearly flagging but that inflation had risen to "unwelcome" levels that would require vigilance. Bernanke's comments on inflation also caused the market odds on a potential June interest rate hike to jump.

•- Oil markets went into a frenzy after Iran's supreme leader Ayatollah Ali Khamenei on June 4 said energy supplies could be disrupted if tension escalates between the US and Iran over the country's nuclear program. "You threaten Iran. You say you want to direct energy in the region. If you make a single mistake about Iran, the supply of energy will definitely be put in serious risk," he said.