Oil prices experienced a volatile day on Friday after Iran anticipated that nuclear talks with the United States will be a long process. The statement cooled expectations of a rapid de-escalation in the Middle East, an important region for the global crude oil production..
In the early hours of the day, Brent crude rose to US$68 per barrel and WTI reached US$64. However, both benchmarks retreated hours later, reflecting investors’ reaction to the lack of immediate progress at the dialogue table.
Oil market under pressure
The talks between the two nations are being held in Muscat, Oman, a historically neutral country that has served as a mediator between Washington and Tehran in several crises. In this first round, an immediate agreement is not expected, but rather the outlining of a roadmap for more in-depth future discussions.
The expectation of a long diplomatic process worries the markets. The possibility of sanctions on Iran remaining in place, coupled with the fragility of regional security, act as factors that keep oil prices volatile.
Although some analysts interpreted the resumption of dialogue as a positive sign, the lack of concrete progress fuels the perception of risk. The Islamic Republic News Agency (IRNA) indicated that Iran’s priority objective in this round is to “assess the goodwill and seriousness of the other side.”
Prospects: an uncertain path
Market participants are skeptical about the possibility of a quick resolution. Given the history of tension between Iran and the United States, any stalemate could lead to new tensions that impact energy security. energy security security.
For now, the evolution of oil prices oil prices will depend on will depend on the concrete gestures that emerge in future sessions. Investors will be on the lookout for any signs of progress or setbacks on the diplomatic path.
Source: OilPrice
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