WASHINGTON (dpa-AFX) - Marginally offsetting the gains from yesterday's jump, crude oil prices have fallen on Thursday as ongoing talks between Iran and Oman over the Strait of Hormuz management induced positivity on the resumption of the free flow of gulf oil. In addition, investors resorted to profit-taking from the 7% gains made in the previous trading session.
WTI Crude Oil for September month delivery was last seen trading down by $0.65 (or 0.77%) at $83.81 per barrel.
Reviving investors' confidence, which took a beating since the shutting of the Strait of Hormuz by Iran after U.S. attacks started on February 28, Iran's Foreign Minister Esmaeil Baghaei stated that negotiations with Oman are continuing through several rounds.
Referring to the U.S. President Donald Trump's naval blockade on Iranian ports and strikes against Iran by U.S. forces, Baghaei remarked that the closure was the result of 'military aggression' by U.S.-Israeli forces which has led to the prevailing insecurity on the waterway.
Iran's Deputy Foreign Minister Kazem Saeed Gharibabadi stated that Iran has proposed a joint arrangement through which both nations can oversee shipping transit through the Strait of Hormuz.
Reportedly, after rejecting Oman's plan for a 50-50 joint management agreement, Iran has put forth a proposal through which Iran can manage the vessel traffic in one direction while Oman can oversee the transits in the opposite direction.
The Strait of Hormuz has two established routes. While the northern route borders Iranian waters (where Iran wishes to have total control), the southern route runs through Oman's territorial waters.
While Oman wants an open Strait of Hormuz, Iran wants to maintain its grip on the strait. Other gulf nations have unitedly called for free passage to ships from all nations and resisted any measure to collect tolls by any country.
U.S. and Iran agreed to halt the war which started on February 28 by signing a Memorandum of Understanding on June 17. However, the exchange of attacks recommenced in less than four weeks.
In the flare-up, shutting the Strait of Hormuz, Iran launched strikes on several U.S. bases in the gulf.
The U.S. military conducted 13 consecutive nights of attacks on Iran. Last Friday, U.S. President Donald Trump ordered U.S. forces to stop the attacks.
After a brief lull for four days, the conflict re-escalated after Iran's Islamic Revolutionary Groups Corps targeted U.S. bases in Jordan by launching several ballistic missiles that U.S. forces successfully intercepted and destroyed.
Trump stated that Iran must be hit harder though he added that he had allowed the talks with Iran to continue, offering a glimmer of hope for the possible success of diplomatic resolution to the conflict.
Today, U.S. Central Command announced completing heavy strikes on Iran.
Attention is shifting to the upcoming meeting by the member nations of the Organization of Petroleum Exporting Countries on Sunday, when the group is expected to announce an output hike for September by 188,000 barrels per day.
The group is reportedly planning to pause the production increases for three months from October.
The U.S. dollar index was last seen trading at 99.90, down by 0.89 (or 0.88%) today.
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