Oil prices continued to fall on Wednesday after the US signaled a shift away from military strikes against Iran toward economic pressure, while an agreement between Iran and Oman to establish a temporary maritime corridor eased supply concerns and prompted profit-taking.
International benchmark Brent crude futures for November delivery traded at $84.86 per barrel at 11.55 a.m. local time (0855 GMT), down 2.8% from the previous close of $87.27.
US benchmark West Texas Intermediate (WTI) crude futures for October delivery traded at $79.83 per barrel, down 1.4% from $80.98.
The decline was driven by reduced expectations of further US military strikes against Iran and hopes that oil flows through the Strait of Hormuz could increase.
US Secretary of State Marco Rubio has told several allied foreign ministers that Washington does not expect to launch new strikes against Iran "for the time being," signaling a shift toward economic and maritime pressure, Axios reported Tuesday.
Citing US officials, the report said Washington plans to intensify economic pressure on Tehran through a naval blockade and tighter sanctions, while seeking to facilitate as much Iranian oil as possible through the Strait of Hormuz into global markets.
- Temporary maritime corridor agreed in Hormuz
Additionally, hopes for progress in talks between Iran and Oman reduced concerns over supply disruptions and encouraged traders to take profits, pushing oil prices lower.
Iranian Deputy Foreign Minister Kazem Gharibabadi said Iran and Oman reached an agreement to activate a temporary joint maritime corridor in the Strait of Hormuz.
The shipping corridor will be seven miles wide while the southern corridor remains closed, Gharibabadi said. He addded that negotiations would continue on establishing a permanent route.
He underlined that the Strait of Hormuz remained closed and that Iran retained full control over the waterway, rejecting reports that ships were currently transiting the strait.
"If US minesweepers enter the area, they will become targets for us. Trump's remarks about mine clearance are aimed only at calming markets," Gharibabadi said.
By Ebru Sengul Cevrioglu
Anadolu Agency
energy@aa.com.tr