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Title: Oil slips from 7-year highs ahead of more U.S.-Iran talks

Feb 08, 2022 02:50AM ET

By: AnalysisWatch

Oil prices slipped on Tuesday ahead of the resumption of indirect talks between the United States and Iran. These could revive a nuclear deal that could lead to the lifting of sanctions on Iranian oil sales and increase global supply.

At 0716 GMT, Brent crude was last down 48 cents, or 0.24%, at $92.47 a barrel after hitting a seven-year high of $94 on Monday. US crude West Texas Intermediate was down 14 cents, or 0.16%, at $91.18 a barrel.

Both oil contracts hit seven-year highs recently, supported by strong global demand, ongoing tensions in Eastern Europe and possible supply disruptions due to cold weather in the US.

Talks on reviving the 2015 nuclear agreement with Iran, taking place in Vienna, will resume on Tuesday after a ten-day break. The United States has reinstated some sanctions exemptions, while Iran is demanding the full lifting of sanctions and a US guarantees not to impose further punitive measures.

While optimism about the US-Iran talks led to profit-taking, the weakness in oil prices is likely to be short-lived as the oil market continues to face a supply deficit, OANDA analyst Edward Moya said.

Saudi Aramco said on Saturday it had raised prices for all grades of crude it sells to Asia in March from February in line with market expectations, reflecting strong demand in Asia and higher margins for gasoil and jet fuel.

In the United States, refineries in Texas were crippled by a citywide blackout on Friday as freezing temperatures from an Arctic cold front swept across the Gulf Coast, although some refineries are recovering or have since returned to near-normal operations.

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