Brent crude oil is going towards its biggest weekly decline since March-2021 as the market accepts the possibility of further oil flows from Iran as the country gets ready for a nuclear deal.
Futures contracts in London traded at nearly $ 65 a barrel after falling more than 6% over the past three days. Iranian President Hassan Rouhani said the world powers agreed to the lifting of major sanctions against his country, although the details of the deal are still unresolved. The upside in Iranian oil exports is reflected in the spread of Brent crude oil, which is approaching a bearish structure marked by easing market tensions.
Oil also fell in bulk commodity sales on Thursday on fears of inflation, speculation that the US Federal Reserve will ease stimulus measures, and warnings from China about measures to contain price increases.
Despite, weekly correction, Oil is still at 25% higher level this year, as a strong recovery from the COVID19 in the United States, China and parts of Europe raises optimism about the outlook for fuel demand.
However, As Iran approaches to increase its oil exports, Citibank Analysts are confident that the market will be able to absorb more barrels and that prices will continue to rise.
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