Oil prices edged lower on Friday as markets weighed reports that the U.S. is close to gaining access to Venezuela's oil reserves, alongside continued U.S.-Iran wrangling over the Strait of Hormuz. Both benchmarks were on track for weekly losses of 4% to 5.5% despite a rebound on Thursday.
West Texas Intermediate crude futures fell 0.6% to $83.04 a barrel, while Brent oil futures dropped 0.4% to $89.34 a barrel by 05:31 ET. The moves came as traders digested a possible shift in crude oil supply out of Venezuela and signals from the Middle East over shipping access.
U.S. nears deal on Venezuela's oil reserves
The Trump administration is close to securing long-term access to a portion of Venezuela's crude reserves, Reuters reported on Thursday. The deal would let the U.S. government secure a group of Venezuelan oilfields for development by American companies.
Markets have been on edge over any potential increase in supply from U.S. control of Venezuela's oil assets, after Washington ousted leader Nicolas Maduro and took control of the country's oil industry. However, analysts have also warned that any actual supply increase will take time, given the scale of development required in Venezuela's oil infrastructure.
A separate report said Venezuela is considering plans to leave OPEC amid growing ties with the United States. The move would mark the second major exit from the producer group after the United Arab Emirates said it would leave OPEC.
Weekly losses persist on mixed U.S.-Iran signals
Both contracts were set to lose between 4% and 5.5% this week, pressured chiefly by earlier reports of Iran and Oman agreeing to allow some traffic through the Strait of Hormuz. Iran said on Thursday it was preparing a list of conditions for reopening the waterway, which supplied about a fifth of the world's oil before the U.S.-Iran war.
But crude trimmed some of its weekly losses on Thursday after the Wall Street Journal reported that Trump had no interest in returning to a June peace deal with Iran. Tehran has repeatedly called on the U.S. to honor the terms of that June peace deal, which lapsed earlier in August, before any further negotiation.
Source: Investing.com
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