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Oil prices dropped more than 3 per cent on Thursday after Donald Trump suggested his administration was making progress in its indirect talks with Iran to reach a deal to curb the Islamic republic’s expansive nuclear programme.
Prices for Brent crude, the international benchmark, slid by as much as 3.7 per cent to $63.68 after the US president said Washington was in “serious negotiations” with Iran. Prices then rebounded slightly to trade at about $63.98 a barrel.
“We’re in very serious negotiations with Iran for long-term peace,” Trump said in Doha, the second leg of his tour of the Gulf, according to a pool report by AFP. “Iran has sort of agreed to the terms . . . We’re getting close to maybe doing a deal.”
Prices for West Texas Intermediate, the US benchmark, traded 3.2 per cent lower at $61.11 a barrel.
Trump’s comments came after his envoy Steve Witkoff held a fourth round of talks with Iranian foreign minister Abbas Araghchi on Sunday ahead of the president’s trip to the region.
Iran’s foreign ministry described the negotiations as “difficult but useful”.
Experts say securing a deal that is acceptable to both sides will be a lengthy and highly complex process given the deep levels of mistrust between the foes and the scale of Iran’s nuclear advances.
US officials have given mixed signals on what they would demand of Iran, but in his most recent comments Witkoff insisted that the Trump administration wanted the full dismantlement of Tehran’s nuclear programme.
He told Breitbart, a rightwing US news website, on Friday that Iran would have to dismantle its three main nuclear facilities and warned that if talks did not make progress on Sunday, they would not continue and “we’ll have to take a different route”.
But that would be a red line for Tehran, which insists that as a signatory to the non-proliferation treaty, it has a right to enrich uranium domestically.
While Trump has repeatedly said he wants a deal with Iran to resolve the crisis, he has also threatened military action if diplomacy fails and reimposed sanctions on Iran as part of his so-called maximum pressure campaign.
After the last round of talks in Oman, Araghchi said that “there will be no compromise over” Iran’s right to enrich uranium.
He added that there was the “possibility that we will agree to some limitations regarding the dimensions, amount and level [of enrichment] for a period to build confidence”.
“But the issue of enrichment is non-negotiable, as is the removal of sanctions,” he said.
