Middle East Talks Spark Oil Price Drop Amid Supply Disruptions
Oil prices dropped more than US$1 on Thursday, marking a fourth consecutive day of declines. The losses came as hopes rose for Middle East talks to ease supply disruptions from the ongoing war in the region.
Brent crude futures fell by US$1.07 (1.2%) to US$86.77 per barrel at 0645 GMT, while West Texas Intermediate crude futures dropped by US$1.13 (1.4%) to US$81.10.
The Strait of Hormuz, a critical waterway that connects major Gulf oil producers to markets and its revenues, has been closed since February 28 when the US-Israeli war on Iran started. Ship-tracking data showed that oil flows through the strait have dropped to about one-quarter of their pre-war level.
ANZ senior commodity strategist Daniel Hynes said 'Crude oil edged lower as the prospect of the Strait of Hormuz reopening improved amid ongoing talks.'