Oil prices slump after US reported to be close to framework deal to end Iran war
LONDON - Oil prices extended declines on Wednesday, slumping to two-week lows after Axios reported that Washington believed it was close to a one-page framework agreement with Iran to end the war.
Brent crude futures fell $6.70, or 6.1%, to $103.17 a barrel by 0856 GMT after touching their lowest in almost two weeks. U.S. West Texas Intermediate lost $6.77, or 6.6%, to $95.50.
Both benchmarks were on track for their biggest daily declines in both percentage and absolute terms since mid-April, having shed about 4% in the previous session.
The U.S. expects Iranian responses on several key points in the next 48 hours, Axios reported. Though nothing has yet been agreed, the report said this was the closest the parties have come to an agreement since the war began.
Iran had said earlier that it would only accept a fair and comprehensive agreement.
The U.S. military said on Monday that it destroyed several Iranian small boats as part of efforts to help stranded ships to exit the Strait of Hormuz.
The crude oil supply losses from halted marine traffic through the strait since the war began in February have driven up prices, with Brent trading last week at its highest since March 2022.
The Strait of Hormuz closure has resulted in a drawdown in global oil and fuel inventories as refineries try to offset production shortfalls.
U.S. crude oil inventories fell for a third week, while gasoline and distillate stocks also declined, market sources said on Tuesday, citing American Petroleum Institute figures.
Crude stocks fell by 8.1 million barrels in the week ended May 1, the sources said. Gasoline inventories were down by 6.1 million barrels from a week earlier and distillate inventories fell by 4.6 million barrels, the sources said.
Official numbers from the EIA, the statistical arm of the U.S. Department of Energy, are due at 1430 GMT.
(Reporting by Shadia NasrallaAdditional reporting by Helen Clark in Melbourne and Jeslyn Lerh in SingaporeEditing by David Goodman)
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This story was originally published May 6, 2026 at 3:28 AM.