Oil prices fall: Markets eye possible US-Iran ceasefire

Oil prices began trading in Asia today with declines. After a week of sharp price swings, markets are weighing the possibility of a ceasefire between the United States and Iran, as well as the possibility of Saudi Arabia being bombed by pro-Iranian Yemeni Houthi rebels.

At around 7:50 CEST, the price of North Sea Brent crude was down 1.5 percent at $105.04 per barrel. US light crude WTI was down 2.3 percent at $92.41 per barrel.

On Thursday, Brent crude rose to its highest level since 15 September and is up 2.09 percent for the week. WTI crude rose for the first time in several days, but is down 6.42 percent for the week. The gap between Brent and WTI prices is now the widest since May. This is mainly due to concerns over a possible ban on diesel exports from the US.

US and Iranian negotiators in New York are now exploring the possibility of gradually ending the military conflict, according to sources. This would include Tehran reopening the Strait of Hormuz and Washington lifting its economic blockade of Iran. Since the start of the war at the end of February, around one-fifth of oil and natural gas supplies have been disrupted. Prices therefore rose by as much as 50 percent in March.

Saudi Arabia intercepted six ballistic missiles launched by the Houthis, thwarting attacks on a southern province near the Red Sea. According to analysts, the attacks are a clear reminder that key oil facilities remain in the conflict zone.

Saudi Arabia is increasing oil supplies through its East-West pipeline, which runs to an export terminal on the Red Sea. However, oil loading onto tankers has not yet resumed, according to industry sources, satellite imagery and shipping data, Reuters reported.

Oil prices in dollars per barrel (around 159 litres)