Ammon News - Oil prices dropped about 1% on Thursday, down for a third consecutive day, after Qatar said Iran and the U.S. ​had made progress in indirect talks focused on the Strait of Hormuz, ‌which handled one-fifth of global oil supply before the war.

The talks made "positive progress" on matters related to the memorandum that halted the war in June, a Qatar Foreign Ministry ​spokesperson said in a post on X, though there was no sign the two ​sides made headway towards a lasting peace.

Brent futures lost 79 cents ⁠or 1.1% to $70.78 a barrel by 0642 GMT, while U.S. West Texas ​Intermediate crude fell 84 cents or 1.2% to $67.74 a barrel. Both benchmarks ​fell more than 1% in the previous session.

As the strait stays open and crude oil flows out, there are growing expectations of oversupply and competition for market share ​is pushing prices down, Haitong Futures said in a note.

OPEC+ oil-producing countries are ​likely to agree to a further hike in their output targets from August when they meet ‌on ⁠Sunday, sources said on Wednesday.

UBS cut on Thursday its Brent forecasts citing the U.S.-Iran pact and the subsequent increase in oil shipping through the Strait of Hormuz.

It cut its average Brent price forecast for the September quarter by $25 and for ​the December quarter ​by $10. The bank ⁠now expects the benchmark to average $80 a barrel during the second half of the year and $75 in 2027.

"Despite ​this, we believe it is premature to assume a ​full normalisation, and ⁠see price risk skewed to the upside, noting that inbound tankers to the Persian Gulf have lagged outbound tankers," UBS said.

The next meeting between Iran and ⁠U.S. negotiators ​will take place after July 9 funeral processions for ​Iran's late Supreme Leader Ayatollah Ali Khamenei, the Qatar ministry added.


Reuters