Global oil prices have fallen sharply amid expectations of talks between the U.S. and Iran — Reuters
On Tuesday, June 30, oil prices on global markets fell to nearly the same level as at the start of the war in Iran. Investors are anticipating possible talks between the U.S. and Iran in Doha, while fearing a breakdown of the fragile ceasefire in the region.
Brent crude for August delivery fell 0.9% to $72.51 per barrel, which is 22% below last month’s closing price.
WTI fell 0.6% to $70.36 per barrel—19% below the May 29 closing price. Both oil grades have nearly returned to their pre-war prices as of February 27.
“Investors are pricing in hopes for a positive outcome from the talks in Doha, although there are no signs yet of a real normalization of oil flows through the Strait of Hormuz,” said Tim Waterer, chief market analyst at KCM Trade.
Uncertainty regarding demand from China is also putting pressure on prices.
“So far, we see no reason to expect a significant return to the market by the world’s largest oil importer,” noted Neil Crosby, head of research at Sparta Commodities.
Iranian Deputy Foreign Minister Kazem Garibabadi announced that Iranian and Omani experts will begin negotiations in the coming days regarding transit routes through the Strait of Hormuz.
Meanwhile, Iranian Foreign Ministry spokesman Esmail Baghai stated that no talks between Iran and the U.S. are scheduled in the coming days.
“The meeting in Doha may turn out to be important, or it may not. We’ll find out,” U.S. President Donald Trump told reporters.
This uncertainty highlights the fragility of the truce reached on June 17. Despite the escalating security situation, Middle Eastern producers continue to export oil and liquefied natural gas, Reuters reports.
The day before, global oil prices plummeted, falling to their lowest levels since the start of the large-scale armed conflict in the Middle East involving the U.S., Israel, and Iran.
Qatar has begun preparing its tanker infrastructure and plans to restore liquefied natural gas (LNG) production to normal levels within a few weeks.
Fertilizer exports through the Strait of Hormuz have risen to pre-war levels, according to Bloomberg.
Global oil prices fell sharply on Thursday, June 19, amid reports of an agreement between the U.S. and Iran. Brent futures fell to $77.96 per barrel, and WTI futures to $74.96, the lowest levels since late February.
