Oil prices increased on Monday over a pause in US-Iran talks on lifting sanctions on the latter and reviving the 2015 nuclear deal, and on rising demand hopes amid the summer driving season.
International benchmark Brent crude was trading at $73.55 per barrel at 07.29 GMT for a 0.05% increase after closing Friday at $73.51 a barrel.
American benchmark West Texas Intermediate (WTI) traded at $71.31 a barrel at the same time for a 0.02% rise after ending the previous session at $71.29 per barrel.
Prices started the week on an optimistic upswing with a delay in extra barrels from Iran coming to the market, given that US-Iran talks are paused for the presidential elections in Iran.
The 6th round of talks to revive the 2015 nuclear agreement, also known as JCPOA, between Iran and world powers in Vienna ended Sunday without any breakthrough and delegates headed back to their respective capitals for consultations.
Following Sunday’s session, Iran's top negotiator Abbas Araghchi said "distance remains" between the two sides on a potential agreement.
Despite the progress claimed by participants, an agreement remains elusive owing to some unresolved issues, including the task of bringing the US back to the deal, according to informed sources.
With conservatives wresting power in Tehran, speculation is rife that the ongoing negotiations could be put on the backburner if Iranian demands are not met before the new government takes over in a few weeks.
Iran's judiciary chief and President-elect Ebrahim Raeisi, an ultra-conservative figure who won Friday’s presidential election by a landslide, will take over from incumbent reformist Hassan Rouhani on Aug. 3.
During his electoral campaign, Raeisi said his administration will "adhere to JCPOA as an agreement approved by the Leader (Ali Khamenei), adding that its implementation needs a "strong government".
The US government has said it hopes to build on the Vienna talks “regardless of who is in power" in Tehran.
-Vaccination rates fuel demand hopes
The oil market became tighter with a narrowing supply-demand gap from the uptake in vaccine campaigns worldwide. This has led to a decline in daily virus cases and the lifting of restrictions in the world’s big economies, including Europe and the US.
Road and air traffic in the US and Europe is back to pre-pandemic levels as countries ease mobility restrictions. However, supply concerns remain due to the slow pace of vaccination in some regions, especially Africa.
According to Our World in Data, which tracks worldwide vaccination pace, as of June 15, 46.8% of the UK’s population is fully vaccinated, while this rate is 15.9% in China, 11.5% in Brazil, 45.4% in the US and just 3.6% in India. A total of 9.6% of the world population has been fully vaccinated.
By Sibel Morrow