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Oil prices up on investor euphoria over tight market

Stalled US-Iran talks puts upward pressure on prices, temporarily pausing extra Iranian barrels on market

Sibel Morrow

Oil prices rose on Tuesday over bullish market sentiments of a sooner-than-expected demand rebound.

International benchmark Brent crude was trading at $75.26 per barrel at 07.29 GMT for a 0.48% increase after closing Monday at $74.90 a barrel.

American benchmark West Texas Intermediate (WTI) traded at $73.33 a barrel at the same time for a 0.28% rise after ending the previous session at $73.12 per barrel.

Brent oil reached its highest level since April 2019 at $75.60 and WTI attained the highest since October 2018 at $73.33.

As the global number of daily coronavirus cases has dropped significantly and domestic and international restrictions have eased in line with the wider use of vaccines against COVID-19, the market has become tighter with more hopes of a quicker demand rebound, ensuring prices have reached record highs.

India, one of the worst-hit countries, saw the lowest daily count in 88 days, reporting 53,256 new COVID-19 cases during the past day.

France announced the final relaxing of restrictions during a news conference on Monday given by Culture Minister Roselyne Bachelot following morning meetings with some top industry professionals of the country, according to BFM TV.

From June 30, performances with standing crowds at 75% indoor capacity and 100% outdoor capacity will be permitted in the country. From July 9, nightclubs will be allowed to reopen.

However, a full global recovery is still not in sight yet, as some countries are battling the virus and the vaccination rates are still low in some parts of the world.

Bangladesh imposed regional restrictions Monday on movements in more districts as the virus situation spiraled out of control and started creating new hotspots outside the capital Dhaka.

Over 2.66 billion vaccine doses have been provided globally, equating to 35 doses per 100 persons.

Africa has the slowest rate of vaccination of any continent, with several governments yet to begin major vaccination campaigns.

US-Iran talks still at stalemate

The stalemate in the indirect talks between the US and Iran continues to exert upward pressure on oil prices as negotiations paused in the Austrian capital due to Iran’s presidential elections.

On Monday, Iran’s President-elect Ebrahim Raeisi called on the US to fulfill its commitments under the 2015 nuclear deal, ruling out new negotiations on the country’s nuclear program.

Addressing his first news conference after winning the June 18 presidential election, Raeisi said his message to the Joe Biden administration is to return to its obligations under the deal and lift sanctions imposed on Tehran.

Raeisi said Washington must be “held accountable” for violating its commitments under the nuclear deal, also known as JCPOA.

Noting that he would not meet US President Biden, he said Iran’s negotiating team currently engaged in negotiations with world powers in Vienna to revive the nuclear deal would follow up on the talks.

He added that the removal of sanctions and the US return to its commitments under the deal would be followed by verification by Iran.

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