Abu Dhabi: Oil prices went down by more than two per cent on Tuesday as Iran held discussions with six major world powers over easing of sanctions related to its controversial nuclear enrichment programme.
Brent, the international benchmark for crude oil was trading around $55 (Dh202) per barrel at around 6pm. Analysts said they are waiting for an official announcement to understand where the oil prices are headed to.
“At the moment oil prices are reacting negatively to the talks. In the morning, oil prices went decreased by more than two per cent as the negotiations began and went up slightly later in the day,” said Dominic Haywood, an oil analyst from Energy Aspects in London.
“If there is an official announcement, we might see a jump or decline in oil prices by two dollars,” he added. Iran, one of the major oil producers was put under sanctions since more than a decade due to its nuclear ambitions.
In its daily update on oil prices, Asiya Research investments said oil prices extended their losses as the Iran nuclear deal is expected to be finalised, which could lift sanctions on Iran. It said Oil WTI declined 1.4% to $48 a barrel, and Brent price fell around 1.0% to $55.8 a barrel.
Oil prices have been dropping for the past few months due to oversupply and weak demand. From a peak of $115 in June last year, oil prices reduced to less than $50 in January. Organisation of the Petroleum Exporting Countries (Opec), which met in Vienna last year refused to cut production to prop up prices. Analysts predicted volatility to continue all through the year owing to weak demand.
