Brent declines ahead of Iran-US talks
The front-month ICE Brent contract has lost by $0.17/bbl on the day from Friday, to trade at $67.42/bbl at 09.00 GMT.
IMAGE: Oil storage tanks. Getty Images
Upward pressure:
Oil has retained some ground after official drilling figures showed a decline in US oil rigs.
The total number of oil rigs declined by three over the week at 409, according to Baker Hughes.
The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.
In a tight market, any signal of reduced future supply can put upward pressure on Brent’s price.
Downward pressure:
Brent crude’s price has come under downward pressure as market participants remained focused on the upcoming US-Iran nuclear talks, that is expected to ease supply-related concerns.
Representatives from both nations will hold a second round of talks in Geneva tomorrow, Reuters reported.
The talks primarily aim to discuss Tehran’s nuclear enrichment programme – something Washington has consistently opposed.
Iran is expected to reach an agreement with the US that could benefit both countries economically, Reuters further reported citing an Iranian diplomat.
The global oil market is facing considerable uncertainty, “over how the situation between the US and Iran evolves,” two analysts from ING Bank noted.
By Aparupa Mazumder
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