PERTH, Aug 5 — Oil steadied on Wednesday after steep falls in the previous two trading sessions, as investors waited to see if efforts to end the United States (US)-Iran war and restore traffic through the blockaded Strait of Hormuz were making progress.
Brent crude futures rose ¢26, or about 0.33 per cent, to US$79.62 a barrel by 0110 GMT. U.S. West Texas Intermediate futures rose 0.16 per cent, or ¢12, to US$75.90 a barrel.
On Tuesday, Qatar said that mediators were making progress in efforts to end the war, driving oil prices lower, although Tehran has denied US President Donald Trump's assertion that talks are already under way. Brent closed below US$80 a barrel on Tuesday for the first time since July 13.
“The main sticking point appears to be whether Iran will continue to insist on a degree of control over the waterway, and whether the US will stand its ground and refuse that outcome,” analysts from IG said in a note.
Brent closed more than five per cent lower on Tuesday after the comments from Qatar, extending Monday's steep losses on hopes that an arrangement could soon be reached. Prior to the war, some 20 per cent of the world’s oil and liquefied natural gas transited through the strait, and in March alone, prices rose by 50 per cent.
Qatar's Emiri office said that Trump and Emir Sheikh Tamim bin Hamad Al Thani discussed efforts to narrow differences between Washington and Tehran and improve the prospects for a lasting settlement during a phone call on Tuesday.
On Monday, Trump said that talks with Tehran had started and Iran faced a "last chance" to reach a deal. In contrast, Iranian officials insisted that no negotiations with the US were taking place.
Market sources, citing data from the American Petroleum Institute, reported that US crude and gasoline inventories rose while distillate stocks fell last week.
Speaking anonymously, they said that crude stocks rose by about 2.7 million barrels in the week ended July 31.
Official numbers from the US Department of Energy's statistical arm, the Energy Information Administration, are due at 10.30 am ET (1430 GMT) on Wednesday.
