Oil fell after Iran and the European Union agreed to resume negotiations on a resumption of the 2015 nuclear deal before the end of next month, signaling a greater prospect of Iranian barrels returning to the market .

New York futures fell 2.4% on Wednesday. A date for the big power talks will be announced next week, Ali Bagheri Kani said in a tweet after meeting with the European Union’s deputy foreign envoy in Brussels. Meanwhile, a US inventory report showing a larger-than-expected gain in crude supply also weighed on prices.

If the negotiations lead to the end of US sanctions and Iranian oil exports increase, it could end the “threat of a supply shortage which was in part the reason for the big oil recovery,” he said. said Fawad Razaqzada, market analyst at ThinkMarkets.

Crude has rebounded in recent months as a gas-centric energy crisis spurs demand for petroleum products and the Organization of the Petroleum Exporting Countries and its allies modestly restore supplies. Global crude inventories are dwindling rapidly and in China crude supplies have fallen to 59% of capacity, according to data analysis firm Kayrros, the lowest since November 2018.

The Biden administration wants to revert to the deal with Iran that the United States abandoned in 2018, but has refused to lift Trump-era sanctions or release Iranian funds before talks resume. Tehran has dramatically expanded its nuclear program in response to Washington’s exit and its tough sanctions regime.

Prices:

• West Texas Intermediate crude for December delivery fell $ 1.99 to $ 82.66 a barrel
• Brent for December settlement fell $ 1.82 to end the session at $ 84.58 a barrel

The Energy Information Administration report showed that U.S. crude inventories rose 4.27 million barrels last week, more than the 2.32 million barrels gain by the American Petroleum Institute, funded by the ‘industry.

Inventories at the nation’s largest storage facility in Cushing, Oklahoma, fell the most since January, reducing supplies to about 27.3 million barrels. Cushing’s inventories were one of the most closely watched parts of the report as supplies approach 20 million barrels. Inventories are running out as the prices of oil for immediate delivery are much higher than for future delivery, making the storage of oil unprofitable.

(With help from Sheela Tobben)