By Adedapo Adesanya
Crude oil prices settled lower on Thursday but rebounded from earlier losses after the US and Iran both denied a report that they were close to a nuclear deal.
Initially, the market fell by more than $3 on the report that the US would give Iran sanctions relief to export oil in return for Tehran reducing uranium enrichment, but later, the loss eased as Brent eventually closed lower by $1.34 or 1.7 per cent to $75.61 per barrel, while the US West Texas Intermediate (WTI) crude dropped $1.58 or 2.2 per cent to close at $71.29 per barrel.
A spokesperson for the White House National Security Council called the report “false and misleading”.
Iran’s mission to the United Nations also cast doubt on the report, saying, “Our comment is the same as the White House comment.”
The US and European Union officials have been searching for ways to curb Iran’s nuclear program since the breakdown of indirect US-Iranian talks on reviving the 2015 nuclear deal between Iran, Britain, China, France, Germany, Russia and the United States.
Analysts noted that if there’s no Iran deal then the market was back to focusing more on fuel demand.
Demand concerns outweighed the prospect of tighter supply after Saudi Arabia pledged at a weekend meeting of the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) to cut crude output by 1 million barrels per day in July.
That unilateral cut was in addition to the group’s broader deal to extend existing supply curbs into 2024.
Meanwhile, Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman discussed in a telephone conversation how to ensure stability in the energy market and praised the cooperation within the OPEC+ deal.
This put to rest the earlier tension that followed the Sunday meeting.
Oil prices could get a lift if the US Federal Reserve skips a rate hike at its next meeting on June 13-14.
Support also came as the US Dollar was slightly weaker on Thursday, making oil cheaper for buyers holding other currencies.
Dipo Olowookere