Oil prices retreated by more than $1 on 21 April as hopes for US-Iran peace talks raised expectations of increased supply from the main production area in the Middle East, reported Reuters.

At 06:00 GMT, Brent crude futures were trading at $94.44 per barrel (bbl), down by $1.04, or 1.1%.

Meanwhile, US West Texas Intermediate (WTI) for May delivery was down by $1.66, or 1.9%, to $87.95/bbl, while the more frequently traded June contract slipped $1.24, or 1.4%, to $86.18/bbl.

The decline reverses a sharp rally in oil prices seen on Monday, when Brent climbed 5.6% and WTI gained 6.9%.

Prices rose after Iran closed the Strait of Hormuz and the US seized an Iranian cargo ship as part of its blockade of Iranian ports.

The Strait of Hormuz is a key route that handles around one-fifth of global oil shipments.

A senior Iranian official was cited by Reuters as saying that Iran is considering whether to take part in peace talks in Pakistan, after recent diplomatic engagement by Islamabad aimed at ending the US blockade.

He said no decision had been made on Iran’s attendance at the talks.

The blockade has so far prevented Iran from fully joining peace initiatives, while a two-week ceasefire is due to expire this week.

Furthermore, Mohammad Baqer Qalibaf, Iran’s Speaker of Parliament, also commented that Tehran would not negotiate under threats.

Amid ongoing disruptions, Kuwait’s state oil company, Kuwait Petroleum, declared force majeure on crude and refined product shipments, citing its inability to fulfil obligations to customers even after the strait's reopening, reported Bloomberg.

The company notified customers of its actions last Friday, as seen in a document by the news agency.

Kuwait previously invoked force majeure in early March as tensions mounted in the region.

The oil facilities in the region have been struck several times, pushing production down to levels not seen since the early 1990s, following Iraq’s invasion.

Kuwaiti officials, however, have said output could be brought back to pre-war levels within a few months once the conflict ends.