By Adedapo Adesanya
Oil moved up Thursday despite reports that American and Iranian negotiators in New York are discussing a phased deal to end the standoff in the Persian Gulf.
Brent crude gained 3.4 per cent to close at $106.60 a barrel, while the US West Texas Intermediate futures
climbed 2.7 per cent to settle at $94.61 per barrel.
US President Donald Trump and Iranian President Masoud Pezeshkian gave defiant speeches to the United Nations’ General Assembly this week, even as their negotiators held talks on the sidelines of the gathering.
Mr Trump said on Tuesday that he faced a “big decision” about whether to negotiate a deal with Iran or “annihilate” the Islamic Republic, while Mr Pezeshkian told UN members the next day that his country will not surrender to America and will continue to fight “until our last breath.”
Iran has set some conditions for the US to fulfil for the Strait of Hormuz to reopen. The US has not rejected these outright this time, but it has not signalled it was open to fulfilling them, either. The conditions include lifting the naval blockade on Iranian ports, an end to sanctions, and unfreezing Iranian assets.
Saudi Arabia has sold almost 100 million barrels of crude to Asian buyers via the Strait of Hormuz since the middle of last week, when it pivoted to the chokepoint it wanted to avoid with the East-West pipeline to the Red Sea.
With the pipeline out of service, the kingdom has sold 100 million barrels of crude, which is roughly one day of total global oil demand, to Asian buyers for October and November delivery through the Strait of Hormuz, according to Bloomberg.
Saudi Arabia this week restored partial operations on the pipeline, but full resumption of flows of about 4 million barrels per day (bpd) would likely take weeks.
Meanwhile, US crude inventories rose by 3 million barrels to 426.4 million barrels in the week ended September 18, the Energy Information Administration said.