Oil edges lower amid Oman-Iran talks on the Strait of Hormuz - Reuters
Kyiv • UNN
Oil prices fell slightly after rising as analysts assessed progress in talks between Oman and Iran on shipping. Traffic through the strait fell to six vessels, while exports dropped to 3 million barrels per day.
Oil prices edged lower on Tuesday after reaching a more-than-one-week high, as analysts assessed signs of progress in talks between Oman and Iran regarding shipping through the Strait of Hormuz, while disruptions to energy supplies from the Middle East continued. Reuters reports, UNN writes.
Details
Brent crude futures fell 50 cents, or 0.57%, to $87.22 a barrel by 13:17 GMT. U.S. West Texas Intermediate (WTI) crude futures declined 36 cents, or 0.44%, to $81.77 a barrel.
Both benchmark crude grades reached their highest levels since July 31 earlier in the session: Brent rose to $90.03 a barrel, while WTI reached $84.61.
Talks between Oman and Iran on the future of shipping in the Strait of Hormuz are currently at an advanced stage, a spokesperson for Qatar's Foreign Ministry said on Tuesday.
Any signs of de-escalation or a deal are good news for risk assets and, obviously, bad for oil. But for now, these are just talks. These are just headlines. There has been no significant progress
Both contracts jumped more than 5% on Monday after U.S. President Donald Trump responded to Iran's conditions for a peace deal with his own demands that Iran pay compensation for those killed in wars, attacks and protests, which is likely to complicate efforts to restore traffic through the Strait of Hormuz.
I don't see oil prices falling below $80 in the near term unless there is an unexpected announcement of a deal that would reopen the Strait of Hormuz, as the oil market is tightening
Addendum
Shipping data showed that traffic through the Strait of Hormuz fell to six vessels on Monday, compared with a 10-day average of about 11 vessels.
In a note on Monday, Barclays analysts said that net exports of crude oil and oil products through the Strait of Hormuz averaged 3 million barrels per day in the week ending August 7, compared with 4.4 million barrels per day the previous week.