Oil prices moved lower on Thursday, retreating from a 4% gain in the previous session, after an Iranian official stated that Tehran remains open to diplomacy to end the ongoing conflict with the United States. According to Reuters, Brent crude futures fell 94 cents, or 0.9%, to $102.13 a barrel, while West Texas Intermediate futures dropped 59 cents, or 0.7%, to $91.56 a barrel by midday.
Diplomatic Signals and Remaining Divisions
A senior Iranian official told Reuters on Wednesday that diplomacy must continue, even though Washington and Tehran remain divided over how to conclude their war. The remarks followed an address by Iran’s president to the United Nations General Assembly, where he stated that Tehran would not surrender to U.S. pressure.
Tehran is currently reviewing Washington’s response to its peace proposals, according to the Iranian official. Those proposals prioritize lifting the U.S. naval blockade on Iranian ports and reopening the Strait of Hormuz, topics that were discussed during indirect talks on Tuesday. However, Iran’s security chief Mohsen Rezaei stated earlier on Wednesday that the strategic waterway would remain closed until Tehran’s conditions are met.
U.S. Secretary of State Marco Rubio told reporters on Wednesday that reaching a deal with Iran requires extensive work over time, adding that President Donald Trump maintains military options.
The diplomatic maneuvering contrasts with market volatility surrounding potential fuel restrictions. Ultra-low-sulfur diesel futures fell about 5% in midday trading following a Politico report that the Trump administration was preparing a 90-day diesel ban, a plan the White House denied.
Later on Wednesday, Bloomberg reported that Energy Secretary Chris Wright told oil industry leaders to brace for possible U.S. curbs on diesel exports during calls late Tuesday. Wright had said earlier on Wednesday that an export ban would not work, despite President Trump expressing support for such a measure. Market analysts warn that export curbs would do little to lower energy prices and could tighten global supplies.
U.S. Crude Inventories Rise
Energy Information Administration (EIA). U.S. crude inventories rose by 3 million barrels to 426.4 million barrels, contrasting with a Reuters poll of analysts who had anticipated a 641,000-barrel draw. Meanwhile, domestic fuel stocks declined over the same period.
Worth a look