Oil Falls to Four-Month Low as Hormuz Shipping Recovers, Iran Talks Ease Supply Concerns
Oil traded at a four-month low early Thursday, falling for a third straight session as supply concerns continued to ease with tankers stranded in the Persian Gulf since the start of the Iran war resuming transit through the Strait of Hormuz.West Texas Intermediate crude oil for August delivery was last seen down 1.9% to $67.92 per barrel, the lowest since Feb. 27, while September Brent oil was down 1.7% to $70.37.The decline came as ships continued to pass through the Strait of Hormuz, easing supply disruptions caused by the conflict. According to HormuzStraitMonitor.co, five ships transited the strait over the past day, leaving about 380 vessels still waiting in the queue.Peace talks between the US and Iran are said to be advancing, with the Wall Street Journal reporting indirect talks between the nations are progressing well,"Brent extended its slide towards USD 70 and pre-war levels as flows through the Strait of Hormuz continued to recover, while signs of progress in indirect US-Iran talks further eased supply concerns. Combined with ongoing releases from the Strategic Petroleum Reserve and demand that has been curtailed by recent high prices, the market remains exposed to a short-term supply glut despite the broader market remaining relatively tight," Saxo Bank noted.U.S. inventories continued to fall last week, with the Energy Information Administration on Wednesday said commercial crude oil inventories and releases from the Strategic Oil Reserve dropped by a combined 13.1-million barrels last week.
