Oil prices declined on 22 April as attention turned to the prospects for continued negotiations between the US and Iran, following US President Donald Trump’s announcement of a ceasefire extension.
At 07:21 GMT, Brent crude futures were trading at $98.16 a barrel (bbl), down by $0.32, or 0.3%, from the previous session, having reached as high as $99.38/bbl earlier in the day, according to Reuters.
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Meanwhile, US West Texas Intermediate (WTI) futures were priced at $89.14/bbl, a decrease of $0.53, or 0.6%, after rising to $90.71/bbl at the start of the session.
Both references rose by around 3% on Tuesday.
President Trump stated that he would extend the ceasefire with Iran indefinitely, just hours before it was set to expire. He said this move would provide additional time for negotiations aimed at ending a conflict that has resulted in thousands of deaths and disruption of the global economy.
It remained unclear if Iran or Israel would agree to prolong the truce, as the announcement appeared to come solely from the US side. The ceasefire has been in place for two weeks.
The US also indicated that its navy would continue to enforce a blockade of Iranian ports and its coastline, which Iranian officials have previously labelled an act of war.
Iranian authorities did not issue an immediate response to Trump’s decision to prolong the ceasefire.
The Tasnim News Agency, which is affiliated with the country’s Revolutionary Guards, reported that Iran had not requested an extension and reiterated its stance that it would seek to break the US blockade by force.
Before the outbreak of conflict with Iran at the end of February, the Strait of Hormuz served as the passageway for roughly 20% of the world’s oil and liquefied natural gas shipments.
Since then, shipping data indicated that activity has largely come to a standstill, with only three vessels transiting the strait during the past 24 hours.
Market sources referencing data from the American Petroleum Institute told the news agency that crude inventories shrank by 4.5 million barrels in the previous week, alongside declines in both petrol and distillate stockpiles.
In a related development, Russian oil exports to India are projected to remain close to record levels in April and May after a fresh US sanctions waiver, according to traders and available data, reported Reuters.
India, the top importer of Russia’s Urals crude and the second-largest buyer of Russian oil after China, brought in a record 2.25 million barrels per day (mbbl/d) from Russia in March, roughly twice the volume purchased in February.
Data from shipping analytics provider Kpler indicated that deliveries of Russian oil to Indian ports are estimated to hit 2.1mbbl/d during the week of 20–27 April, an increase from 1.67mbbl/d the previous week.
