Any revival of the 2015 nuclear deal will help add more crude oil to the global market

Crude oil futures traded lower on Monday morning with the US discussing the revival of the 2015 Iran nuclear deal with some European nations.

At 10.01 am on Monday, October Brent oil futures were at $95.52, down by 1.24 per cent; and September crude oil futures on WTI were at $89.30, down by 1.26 per cent.

September crude oil futures were trading at ₹7150 on Multi Commodity Exchange (MCX) in the initial hour of Monday morning against the previous close of ₹7231, down by 1.12 per cent; and October futures were trading at ₹7133 as against the previous close of ₹7195, down by 0.86 per cent.

According to media reports, the US President Joe Biden on Sunday spoke with the leaders from countries such as France, Germany and the UK. He discussed the ongoing negotiations toward a nuclear agreement. This included the ‘need to strengthen support for partners in the Middle East region’.

Any revival of the 2015 nuclear deal will help add more crude oil to the global market, as it will lead to the lifting of sanctions on Iranian oil by western nations. Last week, Iran had responded to a proposal by European Union (EU) to revive the deal. Iran had urged the US to show a ‘realistic approach and flexibility’ to resolve remaining issues in the deal.

In addition to this, power crisis in China (a major consumer of crude oil in the global market) also affected crude oil prices. Last week, Sichuan province in China started limiting power supply to consumers due to a severe power shortage. The power scarcity was driven mainly by extreme heat waves and drought.

September natural gas futures were trading at ₹732.70 on MCX in the initial hour of Monday morning against the previous close of ₹741.70, down by 1.21 per cent.

NCDEX

On the National Commodities and Derivatives Exchange (NCDEX), September castor futures were trading at ₹7566 in the initial hour of Monday morning against the previous close of ₹7534, up by 0.42 per cent.

September steel long contracts were trading at ₹51710 on NCDEX in the initial hour of Monday morning against the previous close of ₹52810, down by 2.08 per cent.

Business Line by BL Mangaluru Bureau, August 23, 2022