Crude oil eases on Iran deal outlook after approaching $120 a barrel
Oil fell in London, after earlier approaching $120 a barrel, on speculation that high-stakes talks to revive a nuclear deal with Iran could soon conclude.
Benchmark Brent crude hovered in a range near $10 on Thursday, first pushed higher as buyers continued to shun Russian crude, then lower as a tweet from journalist Reza Zandi suggested that Iran could be on the verge of signing an agreement. U.S. and European officials also said a deal was reached, but sticking points remained.
Crude markets have experienced a period of extreme volatility, with prices soaring following President Vladimir Putin’s invasion of Ukraine. Buyers are avoiding Russian crude as they try to circumvent financial sanctions, while markets for refined products have also seen prices soar.
A senior International Atomic Energy Agency official will meet with Iranian leaders on Saturday, according to an IAEA report seen by Bloomberg, suggesting progress toward addressing some of the key remaining issues.
Soaring oil prices have added to inflationary pressures on the global economy, driving up the prices of everything from gasoline at the pump to diesel used by industrial consumers. German Economy Minister Robert Habeck said on Thursday he was against the idea of a ban on Russian energy imports, while reiterating the urgency of the need to reduce dependence on Moscow for supplies.
Despite market turbulence, the Organization of the Petroleum Exporting Countries and its allies remain on the sidelines. The group stuck to the 400,000 barrel-per-day production increase planned for April and wrapped up a meeting on Wednesday in a record time of just 13 minutes, delegates said.
The International Energy Agency has warned that global energy security is at risk and a planned emergency release of crude reserves by the United States and others has done little to allay fears of the Marlet.
“Although Western sanctions have not gone so far as to ban Russian exports, the country’s supply of crude oil and products has clearly been affected either by ‘self-sanction’ or because punitive financial measures make it impossible to finance the oil trade with Russia,” he added. said Tamas Varga, analyst at PVM Oil Associates.