Oil Slumps as the US and Iran Continue Talks
Oil prices closed lower as the United States and Iran appeared set to continue negotiations despite renewed attacks that strained their ceasefire and disrupted tanker traffic through the Strait of Hormuz.
West Texas Intermediate, or WTI, fell 0.9% to settle at US$71.41 per barrel in New York. Despite the daily decline, the US crude benchmark still posted a weekly gain of around 4%.
Brent crude for September delivery slipped 0.4% to close at US$76.01 per barrel. Prices briefly pared their losses before coming under renewed pressure after US President Donald Trump said the ceasefire was over.
Trump also confirmed that talks between the conflicting sides would continue. A US official said technical discussions remained underway, while a Qatari delegation reportedly arrived in Iran to support diplomatic efforts.
The International Energy Agency warned that renewed hostilities between the US and Iran could disrupt efforts to rebuild depleted global oil inventories later this year. Concerns also increased as tanker traffic through the Strait of Hormuz fell sharply.
Ship-tracking data showed that traffic through the strategic waterway remained limited after nearly coming to a halt on Thursday. At least two oil supertankers were reported to have crossed the strait on Friday through a route protected by the United States.
Despite the tensions, the United Arab Emirates increased crude oil production to a record high last month. The move highlighted Abu Dhabi’s efforts to maintain regional energy flows during the conflict.
Scott Shelton, an energy specialist at TP ICAP Group, said the price action suggested that the market did not expect the fighting to last. However, he warned that the supply-and-demand outlook could become increasingly weak once the conflict ends.
Source : Newsmaker.id
