Oil prices fell on Friday and are on track to snap a two-week winning streak, despite settling higher in the previous session following a report that U.S. President Donald Trump is not interested in returning to previous deal terms with Iran.
Brent crude futures were down 60 cents, or 0.67%, to $89.10 a barrel at 0636 GMT. West Texas Intermediate crude futures fell 64 cents, or 0.77%, to $82.89.
Both benchmarks were poised to end the week lower, with Brent down 5.3% and WTI falling 4.3%.
“Despite diplomatic efforts hitting a roadblock, there are growing signs of additional oil flowing through the Strait of Hormuz,” ING analysts said in a note. “As the conflict persists, producers are adapting to the new realities and becoming increasingly comfortable navigating the strait.”
Goldman Sachs on Thursday estimated recent total Gulf exports at 15 million to 16 million barrels per day (bpd), 7 million to 8 million bpd below pre-war levels but 5 million to 6 million above the lowest point in March.
Citing people familiar with the matter, the Wall Street Journal report said the Trump administration has repeatedly told mediators it has no interest in reviving the June memorandum of understanding, complicating diplomatic efforts to restart talks.
Earlier on Thursday, Washington said it was not in talks with Iran despite diplomatic efforts by other countries to re-engage the two sides.
On Monday, the U.S. announced what it called the “toughest sanctions in history” on Iran. Tehran said the sanctions were an “inhumane and hostile act” that had lost their effectiveness.
Elsewhere, geopolitical tensions escalated after Moscow warned it could strike British military targets inside and outside Ukraine in response to Kyiv’s attacks on Russian territory using British-supplied long-range cruise missiles.
Trump, however, said Russian President Vladimir Putin will not attack a North Atlantic Treaty Organization (NATO) country, and he downplayed media reports that CIA Director John Ratcliffe this week had warned Russian officials against such an attack. Britain is one of the founding members of NATO.
(Reporting by Sudarshan Varadhan and Colleen Howe; Editing by Jamie Freed and Thomas Derpinghaus)