Oil prices decline ahead of key OPEC+ production meeting amid US-Iran talks progress
Why this matters: local context for readers following news across Pakistan and the region.
LONDON – Global oil prices declined by around one percent on Thursday, marking a third consecutive day of losses, as signs of progress in indirect negotiations between Iran and the United States eased concerns over potential disruptions to energy supplies through the Strait of Hormuz. Brent crude futures fell by 77 cents, or 1.1 percent, to $70.80 per barrel, while US West Texas Intermediate (WTI) crude dropped 84 cents, or 1.2 percent, to $67.74 per barrel in early trading. Both benchmark contracts had already fallen by more than one percent in the previous session, reaching their lowest levels in nearly four months. The decline followed comments from Qatar’s Foreign Ministry indicating that indirect discussions between Tehran and Washington had achieved positive progress on issues linked to the memorandum that ended hostilities in June. However, officials acknowledged that the negotiations have yet to produce a comprehensive agreement capable of ensuring long-term regional stability. Market analysts said the continued operation of the Strait of Hormuz, one of the world’s most critical oil transit routes, has reduced fears of supply disruptions. With crude exports continuing uninterrupted, expectations of increased global supply and stronger competition among oil producers have added downward pressure on prices. Investors are also closely watching the upcoming meeting of OPEC+ scheduled for Sunday, where member countries are widely expected to approve another increase in oil production targets beginning in August. A further rise in output is anticipated to add more supply to the global market, reinforcing the current bearish sentiment. Meanwhile, global financial institution UBS revised its outlook for Brent crude, lowering its price forecasts for the coming quarters following the easing of geopolitical tensions and the recovery of oil shipments through the Strait of Hormuz. The bank now expects Brent to average around $80 per barrel during the se