Oil slips after Trump says US will help free ships stranded in Strait of Hormuz
By Florence Tan
Oil Prices React to US Efforts in the Strait of Hormuz
SINGAPORE, May 4 (Reuters) - Oil prices eased on Monday after U.S. President Donald Trump said the United States would begin an effort to free up ships stranded in the Strait of Hormuz, however the lack of a U.S.-Iran peace deal kept prices supported above $100.
Brent Crude and West Texas Intermediate Price Movements
Brent crude futures fell 64 cents, or 0.59%, to $107.53 a barrel by 2308 GMT after settling down $2.23 on Friday.
U.S. West Texas Intermediate was at $101.10 a barrel, down 84 cents, or 0.82%, following a $3.13 loss on Friday.
Trump's Statement on Ship Guidance
"For the good of Iran, the Middle East, and the United States, we have told these Countries that we will guide their Ships safely out of these restricted Waterways, so that they can freely and ably get on with their business," Trump wrote in a post on his Truth Social site on Sunday.
Geopolitical Tensions and Peace Talks
Oil prices remained above $100 a barrel with no peace deal in sight and traffic in the Strait of Hormuz still limited. Negotiations between the U.S. and Iran continued over the weekend with the countries assessing responses from each other.
Stalled Negotiations Between US and Iran
"Peace talks have been stalled as both sides refuse to move on their respective red lines," ANZ analysts said in a note.
Key Issues in the Peace Talks
Trump has made a nuclear deal with Tehran a priority, while Iran has proposed to set aside nuclear issues until after the war ends and the foes agree to lift opposing blockades on Gulf shipping.
OPEC+ Output Increase Amid Ongoing Conflict
On Sunday, the Organization of the Petroleum Exporting Countries and their allies, or OPEC+, said they will raise oil output targets by 188,000 barrels per day in June for seven members, the third consecutive monthly rise.
Impact of UAE Departure and Iran Conflict
The increase is the same as that agreed for May minus the share of the United Arab Emirates, which left OPEC on May 1. However, the higher volume will remain largely on paper as long as the Iran war continues to disrupt Gulf oil supplies through the Strait of Hormuz.
(Reporting by Florence Tan; Editing by Edmund Klamann and Sonali Paul)
