Shafaq News
Oil prices extended their declineon Thursday to near levels last seen before the start of the Iran war, asrising supply expectations from the Middle East outweighed demand concerns.
Prompt-month Brent crude futures forAugust delivery fell $1.22, or 1.65%, to $72.52 a barrel as of 0337 GMT, whileU.S. West Texas Intermediate lost $1.02, or 1.45%, to $69.32 a barrel.
Both contracts hit their lowestsince February 27.
August Brent was trading lower thanSeptember, which was priced at $73.59, signalling ample short-term supply.
"The speed of this decline hascaught plenty off guard as markets price in a much faster return of MiddleEastern barrels than most had anticipated just a fortnight ago," IGanalyst Tony Sycamore said in a note.
Brent had fallen more than $3 onWednesday as supply concerns eased, and WTI settled down nearly $3.
U.S. Energy Secretary Chris Wrighttold a forum on Wednesday that flows through the Strait of Hormuz were closeto what they were before the start of the Iran war, saying at least 20 millionbarrels had exited the strait in the last 24 hours. He added a return tocomplete normalcy would take a few weeks because the strait needs to bedemined.
Rising Middle Eastern supply,together with Iran set to boost sales following a temporary reprieve from U.S.sanctions, drove down prices of physical crude oil cargoes around the world.
An initial accord last week to endthe U.S.-Israeli war with Iran, which began on February 28, has allowed trafficthrough the strait to restart.
The accord set up a 60-day period ofnegotiations to tackle more difficult issues including Iran's nuclearprogramme. Wright said oil would continue to flow through the strait even ifthe deal did not hold, and that Iran would not be able to close it again.
Oman on Wednesday opened temporaryroutes to ease tanker departures from the Strait of Hormuz, with theInternational Maritime Organization and Omani authorities coordinatingmovements. Qatar's prime minister visited Oman for talks on initiating negotiationsover the strait's future management with Iran, Iraq and Gulf states.
(REUTERS)
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