(RTTNews) – Oil prices edged up slightly on Wednesday, after having fallen sharply in the previous session on expectations of increased supply.
Brent crude futures for August delivery were up 0.2 percent at $79.10 a barrel after tumbling 5 percent on Tuesday amid investor optimism for an end to the U.S.-Iran war and a possible reopening of the Strait of Hormuz, crucial for oil and gas transit worldwide.
WTI crude futures for July delivery were up 0.1 percent at $76.11 after the American Petroleum Institute estimated that commercial crude oil inventories in the United States fell by 8.33 million barrels during the week ended June 12.
In its latest monthly oil market report, the International Energy Agency (IEA) has slashed its global oil demand outlook for this year and warned that oil inventories remain under severe strain due to the Middle East conflict. At the same time, the IEA said a post-war supply rebound could lead to an oil glut in 2027.
Meanwhile, amid the easing of geopolitical tensions in West Asia, traders await clarity over the specifics of the U.S.-Iran peace deal that will be formally signed on Friday in Switzerland.
According to Bloomberg, Iran could have access to up to $300 billion in reconstruction funds as part of its agreement with the United States.
The proposed agreement could unlock billions in frozen Iranian assets and allow the country to immediately begin selling oil and fuel.
The signing of the Memorandum of Understanding is likely to pave the way for a 60-day negotiating process to address key issues that have plagued U.S.-Iran diplomacy for decades.
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