Crude Oil Price: Crude oil softened, Brent slipped below $88, know why the prices came down?

Business Desk – Crude Oil Price: Crude oil prices remain soft in the international market amid signs of easing military tension in West Asia. The price of Brent crude has fallen below $88 per barrel, while West Texas Intermediate (WTI) is trading around $82 per barrel. The market is hopeful that talks between the US and Iran can move forward, which will reduce concerns about oil supply.

Trump said – gave another chance for talks

According to Axios report, US President Donald Trump said that he has decided to give talks another chance by stopping possible attacks against Iran. However, at present it is not clear whether any formal or concrete talks are going on between the two countries or not. Despite this, this statement has given positive signals in the market and has put pressure on oil prices.

Prices had increased before tension increased, now there is relief

This month saw sharp fluctuations in the prices of crude oil. Oil had earlier become expensive due to increasing tensions between America and Iran and fears of the conflict extending to the Red Sea. But in recent times, due to reducing tension and increasing expectations of talks, prices are falling.

Talks are underway to resume shipping.

Officials in Iran and Oman are in talks to restart oil transportation on the vital sea route, which carries about a fifth of the world’s oil trade in peacetime, Bloomberg reports. This route is considered very important in connecting the Persian Gulf to international markets.

According to the report, senior officials of both the countries also met in Tehran over the weekend. If this arrangement is successful, then progress can also be made towards resolving the long-running dispute between America and Iran through negotiations.

Iran announced to stop retaliatory action

Iran’s military has also announced that it has halted its retaliation against US troops and military bases in the region. This step was also taken as a positive sign by the market, which led to further softening of crude oil prices.

Support also came from increased supply from Kazakhstan

According to another Bloomberg report, oil supplies that were disrupted due to Ukrainian drone attacks are now showing signs of improvement. Loading of two oil tankers has started again at the Caspian Pipeline Consortium (CPC) terminal located near Novorossiysk port in Russia.

According to the Energy Ministry of Kazakhstan, this will reduce supply related concerns in the global market and the availability of oil is expected to improve.

What will the market keep an eye on next?

The direction of crude oil in the coming days will largely depend on US-Iran relations, geopolitical situation in West Asia and global supply. If talks proceed and oil supplies remain normal, prices may remain under pressure. At the same time, in case of any new geopolitical tension, oil prices may rise again.