Brent Slides As Solution To Iran's Disputed Nuclear Program Nears
Brent crude oil sunk even further on Thursday morning as Iran and the West prepared to meet for what many believe could be a major breakthrough in the debate over Iran's nuclear program. The commodity traded at $104.86 at 8:37 GMT on Thursday.
Data released from the Energy Information Administration surprised markets by showing a sharp decline in US gasoline stocks. The report said the nation's socks were down 3.8 million barrels last week, much higher than previous forecasts for a 300,000 barrel decline.
Brent prices also found some support from rising tension in Libya where oil production has fallen to less than half of its normal capacity. Protesters have shut down most of the nation's largest export terminals, and some have moved on to pressure companies like Eni to stop gas exports to other parts of the world.
However, anticipation of the talks set to take place between Iran and the West in Geneva on Thursday overshadowed worries about Libya. Leaders of both sides have been extremely optimistic about the progress that's been made, and CNBC reported that some are saying that the framework for a deal could be hammered out this week.
Iran's disputed nuclear program has kept Brent prices above $100 for years as the West attempted to cut funding to the nation's project. Although Iranian officials have long denied that their nuclear capabilities were aimed at developing nuclear weapons, a lack of transparency caused suspicion among Western leaders.
Now, with both sides willing to negotiate, the sanctions that have kept much of Iran's oil from the market could be removed. The return of Iranian oil coupled with the end of a decade long standoff between the US and Iran would likely push oil prices lower.
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