The White House has refuted claims on Thursday that the United States was close to a deal with Iran over its nuclear program that would entail lifting sanctions on Iran's oil exports.
Despite the assurances from the White House that Iran's oil exports will continue under current sanctions for the foreseeable future, oil prices were still trading down, although earlier losses were significantly larger. At 2:26 p.m., WTI was trading at $71.29 per barrel-down $1.24 (-1.71%) on the day. Brent crude was trading at $75.92 per barrel, or down $1.03 (-1.34%) on the day.
The drop in crude oil prices also comes despite Saudi Arabia's pledge to voluntarily cut another 1 million barrels per day from its current oil production quota, a move designed in part to punish oil speculators.
Reports surfaced earlier in the day on Middle East Eye saying that two unnamed sources claimed that Iran and the United States were coming close to reaching a temporary deal that would reduce or lift at least some of the sanctions against Iran in exchange for Iran curtailing its uranium enrichment program.
"This report is false and misleading," a spokesperson for the National Security Council said.
Other oil price headwinds include rising oil product stocks in the United States and the ever-present stench of disappointing Chinese economic data.
U.S. sanctions have failed to cut Iran's exports to zero, with the country finding dark ways to move its crude around the globe. Iran also hasn't let the sanctions stop it from attempting to forge ties with Iraq on energy matters, signing an agreement last month to expand ties and establish a joint office to boost cooperation between the two countries.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More