Iran talks and U.S. stocks led oil prices to slump to their lowest in two weeks on Thursday. Iran said talks with world powers on its nuclear programme would resume by the end of November. Moreover, U.S. crude inventories rose more than expected.
On Wednesday, Ali Bagheri Kani, Iran’s top nuclear negotiator said the country’s talks with six world powers to try to revive a 2015 nuclear deal will resume by the end of November.
A deal could lead to the lifting of harsh sanctions imposed by the former U.S. President Donald Trump on Iran’s oil exports in late 2018.
Commerzbank (DE:CBKG) said even if the talks resume and turn out to be successful, it is still likely to be quite some time before any agreement is reached and Iranian oil exports return to the market.
By 1020 GMT, Brent crude dropped $1.07, or 1.3%, to $83.51 a barrel. It earlier hit a two-week low of $82.32 and fell by 2.1% in the previous session.
U.S. West Texas Intermediate (WTI) crude sank $1.20, or 1.5%, at $81.46. It earlier reached a two-week low of $80.58 and dropped 2.4% on Wednesday.
Crude and Gasoline Stocks
The U.S. Energy Department said crude stocks rose by 4.3 million barrels last week. That was more than double the 1.9 million barrel gain forecast by analysts.
Citi Research analysts in a note said, the hefty stock build was because of a large jump in net imports of crude oil while refinery processing remained sluggish.
Even as U.S. consumers contend with rising pump prices, gasoline stocks fell by 2 million barrels to their lowest in nearly four years.
Crude storage at the WTI delivery hub in Cushing, Oklahoma is the most depleted for three years. Prices for longer-dated futures contracts indicate supplies will remain low for months.
Meanwhile, in precious metals, gold was up on Thursday morning in Asia. The yellow metal was boosted by a fall in U.S. bond yields.
By 12:14 AM ET (4:14 AM GMT), gold futures rose 0.13% to $1,801.15. It was remaining above the $1,800 mark. Moreover, silver was steady at $24.04 per ounce. Platinum added 0.2% and palladium gained 0.4%.