Brent Slips On Easing Geopolitical Tension

Brent crude oil slipped on Tuesday as talks between the US and Iran later in the week eased some of the tension in the Middle East. The commodity was also pressured by rising supply without any real evidence of growing demand. Brent traded at $108.11 at 6:50 GMT on Tuesday morning after US officials announced that a meeting between President Barack Obama and Iranian President Hassan Rouhani was possible later in the week. Rouhani was recently elected as Iran's new leader, and he began his term by announcing that Iran was willing to discuss the nation's disputed nuclear program and come to a diplomatic solution. If Rouhani and Obama are able to come to an agreement on the country's nuclear capabilities, it would put an end to harsh sanctions which have kept much of Iran's oil from the markets. As geopolitical tension eased, supply increased as exports from both Iraq and Libya climbed. In Iraq, a leaking pipeline has cut down on the country's output, however CNBC reported that the leak has been plugged and output from the country's Rumaila oilfield has resumed. In Libya, labor protests shut down most of the country's largest export terminals and cut its output capacity by more than half. The country has gradually reopened some of the terminals, but exports remain depressed. An official from the Libyan government announced on Monday that the Hariga port may open later this week. Moving forward, investors will be watching the situation in Syria develop as the UN works to create a plan to destroy Syria's chemical weapons. Most are expecting to see a UN decision on how to proceed by the end of the week.