Oil prices slump after Pakistani source says US and Iran are close to framework peace deal

By Shadia Nasralla

LONDON, May 6 (Reuters) - Oil prices extended declines connected Wednesday, slumping to two-week lows aft a Pakistani root said the United States and ‌Iran were nearing an archetypal bid deal.

Brent crude futures fell $10.07, oregon 9.2%, ‌to $99.80 a tube by 1042 GMT, dropping beneath $100 for the archetypal clip since April 22. U.S. West Texas ​Intermediate mislaid $10.79, oregon 10.6%, to $91.48.

Both benchmarks were connected way for their biggest regular declines successful implicit presumption successful a period and deed their lowest successful 2 weeks, having shed astir 4% successful the erstwhile session.

A root from mediator Pakistan said the United States and Iran ‌were closing successful connected an ⁠agreement connected a one-page memorandum of understanding.

U.S. media outlet Axios reported that the U.S. expects Iranian responses connected respective cardinal points successful the ⁠next 48 hours, citing sources saying this was the closest the parties had travel to an statement since the warfare began.

Iran had said earlier that it would lone judge a ​fair and ​comprehensive agreement.

The U.S. subject said connected Monday that ​it destroyed respective Iranian tiny boats ‌as portion of efforts to assistance stranded ships to exit the Strait of Hormuz.

Crude lipid proviso losses from halted marine postulation done the strait since the warfare began successful February person driven up prices, with Brent trading past week astatine its highest since March 2022.

The Strait of Hormuz closure has resulted successful a drawdown successful planetary lipid ‌and substance inventories arsenic refineries effort to offset accumulation ​shortfalls.

U.S. crude lipid inventories fell for a 3rd ​week, portion gasoline and distillate stocks ​also declined, marketplace sources said connected Tuesday, citing American Petroleum Institute ‌figures.

Crude stocks fell by 8.1 cardinal barrels ​in the week ended ​May 1, the sources said. Gasoline inventories were down by 6.1 cardinal barrels from a week earlier and distillate inventories fell by 4.6 cardinal barrels, the ​sources said.

Official numbers from the ‌EIA, the statistical limb of the U.S. Department of Energy, are owed astatine ​1430 GMT.

(Reporting by Shadia NasrallaAdditional reporting by Helen Clark successful Melbourne and ​Jeslyn Lerh successful SingaporeEditing by David Goodman)