Oil prices plunged to their lowest in two weeks as US crude inventories rose more than expected, and Iran announced that it would resume talks on its nuclear deal.
Brent crude dropped to $83.71 a barrel after falling to a two-week low at $82.32. Similarly, US West Texas Intermediate (WTI) crude fell to $82.80 a barrel, having touched a two-week low of $80.58 earlier in the day.
Iran’s diplomat, Ali Bagheri Kani, announced on Wednesday that the country is set to resume discussions on a nuclear deal with world powers that fell through back in 2015. A deal could help lift sanctions on Irani oil exports that were imposed by former US President Donald Trump.
However, even if an agreement is reached soon, it will take some time for Iran’s oil to return to the international markets.
Meanwhile, the US Energy Department said that crude stocks rose by 4.3 million barrels last week, which is more than double what was forecasted by analysts. The gain was attributed to a spike in oil imports along with slow refinery processing, which helped build up stockpiles, according to Citi Research analysts.
However, gasoline stocks fell by 2 million barrels to their lowest level in about four years.
Amid the global energy crunch, oil and gas prices have surged to record highs in the past few months. In a bid to cope, the Pakistani government hiked petrol prices by Rs. 10.49 to a high of Rs. 137.7 per liter, while the price of high-speed diesel was increased by Rs. 12.49 to Rs. 134.48 per liter. The Oil and Gas Regulatory Authority expects prices to continue to rise till March 2022.