OIL gave up gains yesterday and traded lower briefly after an Axios report claimed that the US and Iran have reached an agreement for a 60-day ceasefire extension and the start of talks on Tehran’s nuclear programme.
Brent crude futures were up 33 cents, or 0.4 per cent, at $94.62 a barrel yesterday evening. US West Texas Intermediate futures were up 56 cents, or 0.6pc, at $89.24. Both benchmarks traded down slightly after the report before recovering some ground.
The agreement between the US and Iran still needs final approval from President Donald Trump, who has told mediators he wants a few days to make the final decision, Axios reported, citing US officials and a source involved in the mediation.
Oil prices have been volatile in recent sessions as traders parse through conflicting signals on the possibility of an end to the three-month Iran war and potential re-opening of the Strait of Hormuz. Traffic through the maritime chokepoint remains at a fraction of the pre-war level.
Brent and WTI futures were up more than 2pc earlier in the session after Iran’s Revolutionary Guards said they had targeted a US airbase in response to a US attack on the port city of Bandar Abbas.
It appears that the trading of airstrikes is “part of the negotiating language,” said John Evans, an analyst with PVM Oil Associates.
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