(RTTNews) – Oil prices traded sharply lower on Wednesday as U.S.-Iran talks continued despite new American attacks on missile sites and mine-laying ships in the Strait of Hormuz.
Brent crude futures for August delivery slumped 3.6 percent to $93.22 a barrel while WTI crude futures for July delivery plummeted 4.4 percent to $89.78.
Traders and speculators appear hopeful that the United States and Iran could reach a framework agreement that would extend the ceasefire by 60 days and allow further talks on the re-opening of the Strait of Hormuz.
Some LNG tankers have reportedly passed through the Strait of Hormuz in recent days, helping ease supply concerns amid prolonged West Asia conflict.
As the Middle East conflict appeared to move toward a resolution, U.S. Secretary of State Marco Rubio cautioned that any accord would likely take a few days to finalize.
It seems there are unresolved issues surrounding Tehran’s frozen assets and unrestricted passage through Hormuz.
Meanwhile, Iran condemned the self-defense strikes conducted by U.S. forces and said it would leave no act of aggression unanswered.
Iran’s Islamic Revolutionary Guard Corps (IRGS) said that it targeted and F-35 fighter jet and several drones after identifying “hostile aircraft” entering Iranian airspace.
It is feared that further military escalation could prompt Iran to retaliate against neighboring states.
In a written statement carried by state television, Iran’s Supreme Leader Mojtaba Khamenei said regional countries would no longer be shields for U.S. bases.
Elsewhere, Israel’s attacks on Tuesday resulted in 31 deaths, with over 120 strikes across south Lebanon.
Traders now await inventory data from the American Petroleum Institute later in the day, and the EIA weekly petroleum report on Thursday for further direction.
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