Oil dropped over $1 a barrel on Tuesday, approaching a multi-month low hit last week, pressured by the latest progress in talks to revive the 2015 Iran nuclear accord, which would eventually allow Tehran to boost exports in a tight market.
The European Union on Monday put forward a “final” text to revive the deal. A senior EU official said a final decision on the proposal, which needs U.S. and Iranian approval, was expected within “very, very few weeks”.
Brent crude 1fell $1.34, or 1.4%, to $95.31 a barrel while U.S. West Texas Intermediate (WTI) crude dropped $1.25, or 1.4%, to $89.51.
Talks have dragged on for months without a deal. Still, Iran’s crude exports, according to tanker trackers, are at least 1 million barrels per day below their rate in 2018 when then U.S. President Donald Trump exited the nuclear agreement, so an agreement could allow a sizeable boost in supply.
Oil soared earlier in the year as Russia’s invasion of Ukraine added to supply concerns, with Brent hitting $139 in March, close to its all-time high, in March. Concern of economic slowdown have since weighed.
Brent fell as low as $92.78 on Friday, its lowest since February, as the Bank of England’s warning on Thursday of a drawn-out downturn intensified fears of slowing fuel use.
In another bearish sign, China’s crude oil imports in July fell 9.5% from a year earlier, customs data showed. China is the world’s largest crude importer.