Oil falls on prospects for talks to end Iran war

London: Oil prices fell on Friday as possible further talks between the US and Iran at the weekend and a 10-day ceasefire between Lebanon and Israel raised investors’ hopes the war in the Middle East could be nearing an end.Brent crude futures declined by $3.08, or 3.10%, to $96.31 a barrel at 1138 GMT. US West Texas Intermediate crude futures ⁠fell $3.36, or 3.55%, to $91.33 a barrel.At those levels, Brent futures were heading for a 1.2% gain for the week, and WTI futures were on track for a 5.4% drop from last Friday’s close.”Oil prices are reacting very sensitively to escalation or de-escalation headlines,” said UBS analyst Giovanni Staunovo, after US President ‌Donald Trump indicated that an Iran deal “is very close” on Thursday.Addressing a key sticking point in talks to end the Iran war, Trump said Tehran had offered not to possess nuclear weapons for more than 20 years.”We’re ‌going to see what happens. But I think we’re very close to making ‌a deal with Iran,” Trump told reporters outside the White House on Thursday.Oil prices have fallen ‌below $100 per barrel but remained elevated this ‌week above $90, off the back of 50% rises in March.The temporary nature of the Israel-Lebanon ceasefire, Israel’s goal of significantly weakening the Iranian regime, and unlikely prospects for the Strait ‌of Hormuz reopening immediately all provided a floor to prices, PVM analyst Tamas Varga said.”The ⁠big question if we are getting close to a peace deal is whether there is much further downside in the short term,” said Saxo Bank analyst Ole Hansen, adding that further price decreases would depend on the level of demand ⁠destruction that would help offset the ⁠massive supply shortfall.