Oil prices fell about 2% on Wednesday, extending the prior session’s decline, amid renewed optimism that the Strait of Hormuz might reopen after Iran said it had restarted talks with Oman to manage the Strait as it faces heightened economic pressure from U.S. President Donald Trump.
Iran and Oman have been engaged in intermittent discussions for weeks about managing traffic through the waterway, which transported one-fifth of the world’s oil and liquefied natural gas shipments before the war started in February.
“Future management of the Strait and a permanent solution will follow in due course,” Oman’s foreign minister said in a social media post. “Discussions with regional partners will be conducted in support of peace and cooperation, stability and freedom of navigation.”
On Tuesday, the two countries announced that they discussed establishing “a joint temporary navigational corridor” through the strait and reached an agreement to remove the mines.
Brent crude futures fell $1.78, or 2.0%, to $86.80 a barrel Wednesday, while U.S. West Texas Intermediate crude futures were down $1.49, or 1.8%, at $80.87.
The drop follows both benchmarks declining more than 3% on Tuesday.
On Monday, Washington broadened sanctions designed to cut Iran’s economic support, warning that it may punish countries that still engage in business with Tehran, though it stated it would not enforce penalties right away.
By CEO NA Editorial Staff
