Shafaq News
Oil pricessoftened on Tuesday, with markets weighing reports of mediation efforts betweenthe U.S. and Iran against an exchange of fresh attacks between the two andthreats of a naval blockade of Saudi Arabia by Yemen's Houthis.
Brent crudefutures eased 78 cents, or 0.9%, to $88.44 per barrel by 0415 GMT. U.S. WestTexas Intermediate crude was down 73 cents, or 0.9%, to $82.50 per barrel,while the more active contract for September delivery slipped 41 cents, or0.5%, to $82.07 a barrel.
"There'ssome hope of de-escalation between the U.S. and Iran. Reports are that mediators are proposing a 10-day ceasefire, which couldput the Memorandum of Understanding (MoU) back on track," ING analysts said in a note,referring to the June interim deal.
However, thiswon't be easy as major differences remain between Washington and Tehran, whileTrump has warned of retaliation after several U.S. troops were killed, INGadded.
A seniorIranian official told Reuters Tehran had received a proposal from mediators fora 10-day ceasefire in efforts to salvage the deal signed on June 17, intendedto pave the way for a lasting agreement to end the war that began on February28 with U.S.-Israeli attacks on Iran.
The diplomaticpush followed another night of U.S. strikes on Iranian cities and attacks by Iran'sRevolutionary Guards on U.S. military assets across the region. Later onMonday, U.S. Central Command said it had begun another round of strikes onIran.
A tanker in theStrait of Hormuz reported being struck by an unknown projectile, forcing itscrew to abandon ship and board a lifeboat, the United Kingdom Maritime TradeOperations agency said on Tuesday. Vessel crossings via the strait also dropped furtheramid growing caution following fresh attacks between the U.S. and Iran.
Additionally,Yemen's Iran-aligned Houthis said on Monday they would impose a naval blockadeon Saudi Arabia, opening a potential new front against the U.S. in its war on Iran and raising the threat to global energy supplies and tradebeyond the Gulf.
"Thethreats of a naval blockade on Saudi Arabia by the Houthis are significantbecause they raise the risk of disruption to another major oil exporter," said Tim Waterer, chief market analystat KCM Trade.
Meanwhile, U.S.crude oil stockpiles were expected to have fallen last week alongsidegasoline, while distillate stocks likely rose, a preliminary Reuters pollshowed on Monday.
(Reuters)
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