Oil slips from 7-year highs ahead of more U.S.-Iran talks

08 Feb Oil slips from 7-year highs ahead of more U.S.-Iran talks

Oil prices eased on Tuesday ahead of the resumption of indirect talks between the United States and Iran which may revive a nuclear deal that could lead to the removal of sanctions on Iranian oil sales, increasing global supplies.

Brent crude was last down 22 cents, or 0.24%, at $92.47 a barrel by 0716 GMT, after hitting a seven-year high of $94 on Monday. U.S. West Texas Intermediate crude was down by 14 cents, or 0.16%, at $91.18 a barrel.

Both oil contracts have touched recent seven-year tops, supported by strong global demand, ongoing tensions in Eastern Europe and potential supply disruptions due to cold U.S. weather conditions.

The talks on reviving the 2015 Iran nuclear deal, which are taking place in Vienna, will resume on Tuesday after a 10-day pause. The United States has restored some sanctions waivers, while Iran is demanding a full removal of sanctions and a U.S. guarantee of no further punitive steps.

Saudi Aramco said on Saturday it had raised prices for all crude grades it sells to Asia in March from February, in line with market expectations, reflecting firm demand in Asia and stronger margins for gasoil and jet fuel.  

In the United States, refineries in Texas were knocked out of production on Friday by a citywide power outage, as freezing temperatures from an Arctic cold front swept the Gulf Coast, though some refineries are recovering or have since returned back to near normal operations.

U.S. crude oil and gasoline stockpiles also likely rose last week, while distillate inventories were seen falling, a preliminary Reuters poll showed on Monday. Crude inventories were seen increasing by about 700,000 barrels in the week to Feb. 4.