US-Iran Talks Spark Oil Price Decline as Strait of Hormuz Hopes Rise
Oil prices declined on Friday as investors weighed the possibility of a phased agreement between the United States and Iran that could reopen the Strait of Hormuz.
The decline followed a sharp rally in the previous session when renewed attacks around Saudi Arabia pushed geopolitical supply concerns back to the forefront of the market.
Brent crude oil had settled Thursday at $106.60 per barrel, gaining $3.52, or 3.4 percent and recording its highest closing level since September 15.
A phased arrangement being discussed by both sides would allow Iran to reopen the strategic waterway while the United States eases or removes its economic blockade of Tehran.
Under such an agreement, Iran could restore freedom of navigation through the Strait of Hormuz, which is critical to supplies from major Middle Eastern producers.