.png){kind=logo}
Oil prices fell on Thursday, August 27, as diplomatic efforts raised hopes of reopening the Strait of Hormuz. Talks involving Iran, Oman and Qatar encouraged expectations of fewer disruptions to Middle East energy shipments.
Brent crude futures lost 41 cents, or 0.5%, to $87.43 a barrel at 03:30 GMT. U.S. West Texas Intermediate crude fell 37 cents, or 0.5%, to $81.86. Brent headed for a fourth consecutive daily decline, while WTI approached a fifth.
A senior Iranian source told Reuters on Wednesday that Iran and Oman were finalising details of a Hormuz agreement. Earlier, Iran’s Revolutionary Guards said the countries had agreed to share control of the waterway and its revenues.
However, Iran says the strait will not reopen fully unless Washington meets conditions under a June ceasefire agreement. That arrangement later broke down.
Meanwhile, Qatar’s prime minister, Sheikh Mohammed bin Abdulrahman al-Thani, plans to visit Tehran on Thursday. He aims to restart talks to end the conflict. The United States has paused attacks on Iran for about a month while pursuing greater economic pressure.
Iran has also attacked shipping in the Gulf and the strait as it seeks greater control over the shipping route.
Before the war began on February 28, shipments through Hormuz equalled roughly one-fifth of global oil and gas consumption. Ship-tracking data now puts oil flows at around one-quarter of their previous level.
Daniel Hynes, ANZ’s senior commodity strategist, linked the decline to improved prospects for reopening Hormuz. Nevertheless, he cautioned that “concerns over shortages in the oil market persist.”
Supply pressure also extends to refined fuels. The Middle East conflict has damaged refineries. Ukrainian attacks on Russian facilities have reduced exports from another major diesel supplier.
U.S. Energy Information Administration data show distillate inventories fell 2.2 million barrels during the week ending August 21. Stocks totalled 103.4 million barrels, including diesel and heating oil. Hynes described that volume as the lowest recorded for this time of year.
That compares with 114.2 million barrels during the comparable week a year earlier, according to the agency.
The agency also placed distillate stocks about 14% below their five-year seasonal average. U.S. refineries operated at 97.4% of available capacity, while distillate production declined to an average 5.1 million barrels daily.
Meanwhile, gasoline inventories dropped 2.5 million barrels and stood 6% below their five-year seasonal average. Commercial crude stocks increased 0.1 million barrels to 428.9 million, excluding the Strategic Petroleum Reserve.
Retail diesel averaged $5.652 per gallon on August 24, up 19.8 cents from the previous week. The price exceeded its level a year earlier by $1.944 per gallon.
In a technical assessment published Thursday, analyst Muhammad Umair identified WTI support at $77.50 and resistance near $87. These levels mark areas where his analysis identifies possible buying or selling pressure.
His daily chart assessment places WTI above its 50-day and 200-day average prices despite the recent decline. Umair identifies $72 as a lower support area and $93 as a potential target above resistance.
On the four-hour chart, Umair identifies $74 as a level supporting WTI’s upward pattern over that shorter timeframe.
For Brent, the same assessment identifies $86 as support and $95 as resistance. A move below support could bring $76 into view, according to Umair. He places the next potential upside target at $101 following a break above $95.
ALSO READ: Crypto Prices Today: Bitcoin Holds Near $78,623, Solana Leads Daily Gains Ahead of Jackson Hole
