Oil prices fall 2% as Iran talks offset Ukraine crisis

Oil prices tumbled about 2% on Thursday as talks to revive a nuclear deal with Iran entered their final stages and could free up more oil supplies, but losses were limited by tension between the main energy exporter, Russia, and the West on Ukraine.

“(The) oil market is caught in a tug of war between Iranian sanctions relief and Russia-Ukraine tensions,” said Stephen Brennock of broker PVM Oil.

Brent crude futures dipped $1.84, or 1.9%, to close at $92.97 a barrel, while U.S. crude (WTI) fell $1.90, or 2.0%, to close. at $91.76.

Both benchmarks hit their highs since September 2014 earlier in the week, and both remain in “backwardation”, in a market structure where immediate contracts are more expensive than those of later dates, indicating a shortage of supply. .

Brent and WTI futures through August were in what Robert Yawger, executive director of energy futures at Mizuho, ​​called “super-backwardation,” with each month trading at least $1 a barrel below the previous month.

“The price could already be in triple-digit territory if it weren’t for the U.S.-Iran nuclear talks,” said Craig Erlam, a market analyst at OANDA, noting that a deal “could mean around 1.3 million barrels. per day (bpd) of oil rapidly re-entering the market.”

Source: CNN Brasil

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