Oil prices decreased sharply following comments from President Trump indicating the U.S. is close to a nuclear deal with Iran.
Iran’s officials have suggested they would consider abandoning uranium enrichment if the United States lifts economic sanctions.
Recent reports of a U.S. crude oil inventory build further contributed to the downward pressure on oil prices.
Oil prices dipped by 4% early on Thursday after U.S. President Donald Trump said the United States were close to a nuclear deal with Iran, while a top Iranian officials hinted at Tehran abandoning uranium enrichment if the U.S. lifts the economic sanctions.
In Asian and early European trade on Thursday, the U.S. oil benchmark, WTI Crude, was down by 4.12% at $60.58 a barrel, while the international benchmark, Brent Crude, was falling by 3.80% on the day and traded at $63.52 per barrel.
Oil came under pressure late on Wednesday after the U.S. Energy Information Administration (EIA) confirmed a crude oil inventory increase of 4 million barrels during the week ending May 9. On Tuesday, the American Petroleum Institute (API) reported a surprise build in US crude oil inventories of 4.287 million barrels in U.S. crude oil inventories with draws in gasoline and distillate stocks.
The slide in oil prices intensified early on Thursday, after President Trump said “We’re in very serious negotiations with Iran for long-term peace.”
“We’re getting close to maybe doing a deal without having to do this… there (are) two steps to doing this, there is a very, very nice step and there is the violent step, but I don’t want to do it the second way,” President Trump told a pool of reporters during his tour of the Middle East.
Meanwhile, Ali Shamkhani, a top political, military, and nuclear adviser to Iran’s Supreme Leader Ayatollah Ali Khamenei, told NBC News that Iran is ready to sign a nuclear deal with the United States under certain conditions, including the U.S. lifting the sanctions on Tehran.
These comments came hours after the U.S. Treasury slapped additional sanctions on Iran, designating nearly two dozen firms operating in multiple jurisdictions in virtually every aspect of Iran’s illicit international oil trade.
By Tsvetana Paraskova for Oilprice.com
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