Global oil prices continued to fall on Tuesday extending losses for a second consecutive session as signs of easing tensions between the United States and Iran reduced geopolitical risk premiums while a stronger US dollar added further pressure.
Brent crude futures slipped 34 cents, or 0.5 per cent, to $65.96 per barrel, while US West Texas Intermediate (WTI) crude fell 32 cents or 0.5 per cent to $61.81 a barrel.The decline followed a sharp drop of more than four per cent on Monday, one of the steepest single day losses in recent months.
The pullback came after US President Donald Trump said Iran was seriously talking with Washington raising hopes of reduced hostilities with the OPEC member. Officials confirmed that nuclear talks are expected to resume in Turkey on Friday. Iranian President Masoud Pezeshkian said Tehran supports dialogue to protect national interests, provided talks proceed without threats or excessive demands.
Markets interpreted these developments as lowering the risk of near term supply disruptions from the Middle East prompting traders to unwind recent risk premiums.
Oil prices were further pressured by a firmer US dollar which makes crude more expensive for holders of other currencies.Analysts warned that oil markets are likely to remain volatile driven by geopolitical headlines and shifting macroeconomic signals.
For oil importing countries like Pakistan sustained lower prices could offer temporary relief though uncertainty remains high.
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