Oil Hits One-Week Low On Report Of Iran Nuclear Deal, Later Denied By White House

NEW YORK (UrduPoint News / Sputnik - 09th June, 2023) Oil prices hit a one-week bottom on Thursday before settling off their lows as the White House called "false and misleading" a report that the United States and Iran had agreed to a nuclear deal that would let the Islamic republic legally export some of its sanctioned oil.

New York-traded West Texas Intermediate, or WTI, crude settled down $1.24, or 1.17%, at $71.29 per barrel. The benchmark for US crude plunged to a one-week low of $69.09 earlier, breaking its key $70 psychological support.

London-traded Brent crude officially finished the day down 99 cents, or 1.3%, at $75.96. The session low for the global crude benchmark was $73.61, breaking its $75 support.

Both WTI and Brent hit one-week lows after the middle East Eye website said Iran would commit to cease enriching uranium to purity of 60% or above and would continue cooperation with the UN nuclear watchdog in return for being allowed to export up to 1 million barrels of oil per day.

Tehran would also gain access "to its income and other frozen funds abroad," the report said. It cited two unnamed sources as saying Iran and the United States were "nearing a temporary deal that would swap some sanctions relief for reducing Iranian uranium enrichment activities." The report also said "the two sides have reached an agreement on a temporary deal to take to their respective superiors.

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The White House outrightly dismissed the story.

"This report is false and misleading," a spokesperson for the White House National Security Council said in comments carried by Reuters, referring to the report that appeared on the Middle East Eye website. "Any reports of an interim deal are false."

Notwithstanding crude's rebound from Thursday's lows, fundamental worries about supply-demand continue to weigh on the market, said analysts.

"While we wait to see if US-Iran nuclear negotiations get anywhere after this, today's price move tells you there are so many things that aren't well with the oil market despite Saudis attempts to push it higher with one promised production cut after another," John Kilduff, partner at New York energy hedge fund Again Capital, said in a text message to Sputnik.

Saudi Arabia said on Sunday it would take off another million barrels per day from its production in July, effectively removing some 2.5 million barrels per day since October from its normal daily output of 11.5 million barrels. The Saudi pledge came after its 12 partners in OPEC, or the Organization of the Petroleum Exporting Countries, and 10 other allies, including Russia, in OPEC+ alliance decided to stay pat on production.