Oil prices traded flat on Thursday (Aug 6) following a sharp decline earlier in the week. Brent crude hovered around US$79.48 per barrel, while WTI edged down to US$75.12 per barrel.
Over the past week, both benchmarks have recorded drops of more than 10%. Pressure mounted as the market grew increasingly optimistic that shipping lanes through the Strait of Hormuz could be reopened.
Iran had previously announced an agreement with Oman regarding coordinates for a temporary shipping lane. The Strait of Hormuz is a vital artery through which approximately one-fifth of the world’s oil and liquefied natural gas (LNG) supplies previously passed.
However, the agreement does not yet mean the Strait of Hormuz is fully open. Discussions regarding shipping fees, vessel inspections, and security guarantees remain unresolved.
US President Donald Trump stated that Washington is in communication with Tehran. However, Iran has denied the existence of direct peace talks, leaving the market cautious as it awaits further developments.
Newsmaker Analysis: Oil prices remain vulnerable to downward pressure if US-Iran negotiations show progress and energy shipments begin to recover. Conversely, a breakdown in talks or the emergence of new security disruptions could push Brent back above US$80 per barrel.
Source: Newsmaker.id