By Adedapo Adesanya
Crude oil prices settled higher on Friday but posted their steepest weekly decline since November as talks to revive the 2015 Iran nuclear deal was paused.
Brent crude futures rose $3.34 or 3.05 per cent to trade at $112.67 per barrel and the US West Texas Intermediate (WTI) crude futures appreciated by $3.31 or 3.12 per cent to $109.33 per barrel.
The week saw prices post their steepest weekly decline in five months as traders assessed potential improvements to the supply outlook that has been disrupted by Russia’s invasion of Ukraine.
Earlier in the week, futures benchmarks hit their highest levels since 2008 as the US made some moves to balance the market as well as placed an embargo on Russian oil.
Previously, the White House had dismissed the idea of banning Russian crude oil imports, pointing out that doing so could cause oil and gasoline prices to rise even more than they already had.
This then pulled back sharply as some producing countries signalled they may boost supply.
On Friday, supply concerns grew when talks to revive the 2015 Iran nuclear deal faced the threat of collapse after a last-minute Russian demand forced world powers to pause negotiations.
Discussions have reached the final stages after 11 months of trying to restore the deal, which is expected to lift sanctions on Iran in return for curbs on its nuclear programme, long seen by the West as a cover for developing atomic bombs.
Failure to reach a deal could prompt the West to impose additional harsh sanctions on Iran, and further escalate world oil prices already strained by the Ukraine conflict.
Even if reached, any agreement will not immediately allow Iran to legally export oil as compliance with the agreement would take a few months to verify.
Crude futures have soared more than 25 per cent since the United States and allies sanctioned Russia following its February 24 invasion of Ukraine.
Russian oil sales have been disrupted, with sellers finding it very difficult to make deals even as they offer massive discounts to benchmark Brent crude.
Analysts note that the focus will shift to oil market reports from the International Energy Administration (IEA) and the Organization of the Petroleum Exporting Countries (OPEC) next week with both previously indicating the market should be oversupplied this year.
US rig data from energy services firm Baker Hughes Co showed drillers added 13 oil and natural gas rigs, bringing the total to 663, the ninth increase in 10 weeks.
The data is an early indicator of future output. US government officials have called on domestic and global producers to ramp up output.
