Crude falls with Iran talks, weak demand

Oil prices fell Monday as nuclear negotiations between Iran and Western diplomats over lifting sanctions remained in a deadlock over the weekend.

If sanctions are lifted, then exportation of Iranian crude oil could contribute to an already-existing glut in oil supply in the global market. The potential for Iran to increase the exportation of crude has caused speculation after <a href=’https://theenergyyear.com/companies-institutions/opec/’>OPEC asked to cut supply.

Benchmark Brent crude futures dropped to $56.10 down 31 cents, and U.S. West Texas Intermediate futures were at $48.15 a barrel down 72 cents.

According to analysts, the strong dollar and weak demand also had a factor in low prices.

“Demand growth in the OECD has been in structural decline over the past five years … (and) continued dollar strength is a headwind to the oil price recovery,” Barclays said.

Brokerage Phillips Futures predicted that oil prices will fall further to $50-53 for Brent and $46-48 for U.S. crude in the second quarter beginning in April.