Oil prices continue slide amid hopes for peace, opening of Strait of Hormuz

Brent crude drops to lowest price since early March before signing of framework deal to end US-Israel war on Iran.Oil prices are continuing to drop, as hopes rise for a return to stability in global energy markets before the signing of a framework agreement on ending the United States-Israel war on Iran.Futures for Brent crude due for delivery in August dipped nearly 1 percent on Wednesday, extending declines of about 5 percent on each of the previous two days.Recommended Stories list of 4 itemslist 1 of 4Messi hat-trick fires holders Argentina to win over Algeria at World Cuplist 2 of 4Russian drone strikes residential building in Ukrainelist 3 of 4Trump administration seeks to halt air pollution lawsuit against Musk’s xAIlist 4 of 4Messi breaks World Cup record, rewrites history on a special night for Argentinaend of listThe international benchmark stood at $78.24 a barrel as of 08:00 GMT, the lowest price since March 3, three days after the start of the war.After rising more than 50 percent during the conflict, the price of crude on Wednesday afternoon in Asia was only about 7 percent higher than before the US and Israel launched attacks on Iran on February 28.“The immediate prognosis, it seems, is optimistic and assumes no significant setbacks,” Tamas Varga, an analyst at PVM Oil Associates in London, said in a commentary.“Over the last four trading sessions, Brent, for example, has fallen by $17 [per barrel], a discernible vote of confidence that the worst, at least as far as supply disruptions are concerned, is behind us,” Varga said.Vandana Hari, the founder of the Singapore-based oil market analysis provider Vanda Insights, said that while the announcement of the US and Iran’s memorandum of understanding (MoU) has brought relief to markets, the “hardest part, on delivering the pledges and promises, is yet to come”.“Crude’s slide is entirely sentiment-driven,” Hari told Al Jazeera.“The market is front-running the prospective reopening of the Strait of Hormuz and likely pricing in the best-case scenario for the normalisation of flows, which means the potential hiccups from logistics to renewed geopolitical tensions are not being adequately factored in,” Hari said.