Oil slips as investors focus on Hormuz talks

Business Recorder reported that crude futures slipped on Wednesday as traders tracked talks between Iran and Oman over the Strait of Hormuz. Brent lost 71 cents, equal to 0.8%, and stood at $87.87 a barrel during mid-morning US trade. West Texas Intermediate dropped 48 cents to $81.88, and both benchmarks touched their weakest point since August 10 earlier in the session before recovering part of the loss.

Analysts said the Iran-Oman discussions had altered market sentiment. Saxo Bank's Ole Hansen argued that traders were shifting toward expecting a partial restart of transit, agreed shipping rules and fewer chances of fresh military confrontation. He added that a credible deal restoring Hormuz flows quickly could strip out a further slice of geopolitical risk pricing. Stockpile data also helped, as U.S. crude inventories rose by 95,000 barrels to 428.9 million in the week ended August 21, below the 597,000-barrel gain expected in a Reuters poll.

Kpler ship-tracking data showed only five commodity vessels passed through the waterway on Tuesday, against a 10-day average of 15. Before hostilities began in late February, roughly a fifth of worldwide crude and gas shipments travelled along this route. Separately, the Ukrainian General Staff said its forces struck Lukoil's NORSI refinery, located in the Nizhny Novgorod area, overnight.