By Nicole Jao<\/p>\n
NEW YORK, May 20 (Reuters) – Oil prices fell 6% on Wednesday after U.S. President Donald Trump said that negotiations with Iran were in the final stages, though investors remain wary about the outcome of \u200cpeace talks as disruption to Middle Eastern supply continues.<\/p>\n
Brent crude futures fell $6.64, or 5.97%, to $104.64 a barrel by \u200c1:45 p.m. EDT (1745 GMT) and U.S. West Texas Intermediate futures were down $6.49, or 6.23%, at $97.66.<\/p>\n
Trump said that negotiations with Iran were in the final stages but \u200bwarned of further attacks unless Iran agrees to a deal.<\/p>\n
Iranian foreign ministry spokesperson Esmaeil Baghaei said Iran was ready to develop protocols for safe shipping traffic in cooperation with other coastal states, without providing further details.<\/p>\n
Despite signs of progress, some market participants and analysts remain wary about the outcome of negotiations and global supply tightness that will likely persist even if the U.S. and Iran reach a \u200cdeal.<\/p>\n
“You’ve got to take all these pronouncements with \u2060a grain of salt these days, but the market was also quick to reward it and price in the hope of a resolution,” said John Kilduff, partner at Again Capital.<\/p>\n
Analysts at Citi said \u2060on Tuesday that they expect Brent crude to rise to $120 a barrel in the near term, stating that oil markets are underpricing the risk of prolonged supply disruption, and Wood Mackenzie estimated that it could approach $200 if the Strait of Hormuz stays largely shut until the end \u200bof \u200bthe year.<\/p>\n
Similarly, PVM analysts said global oil stocks could reach critically low \u200blevels. “Yet, as observed lately, market players are comparatively \u200cnonchalant (or complacent) about what the conflict might bring,” PVM said.<\/p>\n
The premium on Brent contracts for delivery next month over contracts for delivery in six months – an indicator of traders’ views of current supply tightness – is around $20 a barrel, way below last month’s highs above $35.<\/p>\n
Russian Deputy Prime Minister Alexander Novak said on Wednesday that some countries were lifting sanctions on Russian oil because global markets cannot function without it, the state TASS news agency reported.<\/p>\n
Three supertankers were crossing the Strait of Hormuz on Wednesday, carrying oil bound \u200cfor Asian markets, after waiting in the Gulf for more than two \u200bmonths with 6 million barrels of Middle East crude on board. The \u200bnumber of vessels crossing the strait remains well below \u200bthe 130 or so ships that crossed daily before the war.<\/p>\n
UAE ADNOC Chief Executive Sultan Al Jaber \u200csaid on Wednesday it will take at least four \u200bmonths to get back to 80% \u200bof pre-conflict flows.<\/p>\n
To make up the supply shortfall, countries are relying on commercial and strategic inventories.<\/p>\n
U.S. crude stockpiles fell last week as demand remained elevated, the Energy Information Administration said on Wednesday. Crude inventories fell by 7.9 million \u200bbarrels to 445 million barrels in the \u200cweek ended May 15, the EIA said, compared with analysts’ expectations in a Reuters poll for a 2.9 million-barrel \u200bdraw.<\/p>\n
(Reporting by Nicole Jao in New YorkAdditional reporting by Shadia Nasralla and Stephanie Kelly in London, Yuka \u200bObayashi and Jeslyn Lerh in SingaporeEditing by Nick Zieminski, Kirsten Donovan)<\/p>\n","protected":false},"excerpt":{"rendered":"By Nicole Jao NEW YORK, May 20 (Reuters) – Oil prices fell 6% on Wednesday after U.S. President…\n","protected":false},"author":2,"featured_media":123527,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[3],"tags":[1872,34,6476,864,19809,24628],"class_list":["post-123526","post","type-post","status-publish","format-standard","has-post-thumbnail","category-iran","tag-brent-crude","tag-iran","tag-negotiations","tag-president-donald-trump","tag-supply-disruption","tag-u-s-west-texas-intermediate"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@iran\/116608429150128966","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts\/123526","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/comments?post=123526"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/posts\/123526\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/media\/123527"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/media?parent=123526"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/categories?post=123526"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/iran\/wp-json\/wp\/v2\/tags?post=123526"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}