Brent Oil Retreats Amid US-Iran Talks on Re-Establishing Exports

Brent oil prices have retreated from their peak of $97 per barrel amid signs that the US and Iran are working towards re-establishing exports from the Persian Gulf. Reports suggest that negotiators from both countries are exploring a deal that would lift naval blockades against tankers crossing the Strait of Hormuz and ease US sanctions on the Iranian economy.

The disruption to oil exports had been severe, with commercial vessels being attacked earlier this month causing a near standstill in tanker flows. This was compounded by attacks on the East-West pipeline in Saudi Arabia, which had been diverting 7 million bpd of crude to Red Sea ports.

Major OPEC members have been forced to cut oil production due to the prolonged halt of tanker flows from the region. Saudi output has recently dropped to its lowest level since 1990.