-- Crude oil futures were little changed in after-hours trading on Wednesday as the market weighed the prospect of US-Iran peace talks to end the Middle East conflict that has brought traffic via the vital Strait of Hormuz to a near halt.
Front-month West Texas Intermediate crude futures eased by 0.12% to $91.39 per barrel, while Brent futures were up 0.12% to $94.91/bbl.
Saxo Bank strategists said the US and Iran are preparing for a second round of peace talks in the coming days, with Tehran reportedly considering a pause in shipments through the Hormuz to smooth negotiations.
US crude stockpiles fell by 900,000 barrels to 463.8 million bbls in the week ended Apr. 10, the Energy Information Administration said in its weekly report on Wednesday.
Total motor gasoline stockpiles decreased by 6.3 mmbbls from last week to 232.9 mmbbls, and distillate stocks dropped by 3.1 mmbbls to 111.6 mmbbls, the agency said.
The US and Iran are reportedly considering extending their ceasefire, which ends next Tuesday, by another two weeks to allow more time to negotiate a peace agreement. However, the Treasury Department said on Tuesday the US would not renew general licenses that allowed for the temporary sale of certain Russian and Iranian crude.
"The short-term authorization permitting the sale of Iranian oil already stranded at sea is set to expire in a few days and will not be renewed," the Treasury said in a social media post on X.
The waiver, issued by the Treasury on Mar. 20, allowed about 140 million barrels of Iranian crude already at sea to reach buyers, primarily in Asia.
On Wednesday, Pakistani army chief Asim Munir arrived in Tehran for talks to ease tensions in the Middle East and arrange a second round of US-Iran peace negotiations, according to media reports.
President Trump is also reportedly voicing optimism about a potential deal with Iran to end the conflict currently paused by a two-week ceasefire.
Ole R. Hvalbye, commodities analyst at SEB Research, said the market reads the diplomatic developments as a material de-escalation signal, which is naturally pulling the financial crude contracts lower.
Meanwhile, the US Central Command said its blockade of Hormuz is now fully in effect, "completely" cutting off Tehran's international sea trade, which powers about 90% of its economy.
The US-sanctioned Chinese-owned tanker Rich Starry made its way back to the Hormuz on Wednesday after exiting the Arabian Gulf the day before, according to media reports.
Meanwhile, MarineTraffic said on Thursday the Malta-flagged crude tanker Agios Fanourios I became the first crude carrier to transit the Strait since the US blockade came into force.
Karan Satwani, senior analyst, supply chain research at Rystad Energy, said the ceasefire continues to shape the operating environment, alongside risks of disruption and potential blockades affecting shipping via the Hormuz.