Oil Falls After Weekly Gain as Iran Signals Gaza Talks Progress

A steady decline in oil prices over the past week could come to an end, pending diplomatic solutions out of Iran.

Oil declined following last week’s advance after Iran’s foreign minister flagged the Israel-Hamas conflict could be moving closer to a diplomatic solution. Trading remained muted with many Asia markets closed for Lunar New Year holidays.

Brent fell as much as 0.8% to below $82 a barrel, after gaining 6.3% last week, while West Texas Intermediate traded near $76.

Iran’s Hossein Amirabdollahian held talks in Beirut and discussed the potential release of Israeli hostages, including with senior officials from Hamas. “Developments in Gaza are moving toward a diplomatic solution,” he said, without offering any specifics on timing.

Meanwhile, Israel’s Prime Minister Benjamin Netanyahu insisted Sunday that civilians would be directed out of harm’s way before an Israeli military operation in the southern city of Rafah.

Oil has traded within a band of about $10 for most of this year as nervousness over the conflict in the Middle East has been partially offset by ample global supply and a shaky demand outlook — especially in China, the second-biggest consumer.

There are additional downside risks to demand forecasts for China, Goldman Sachs Group Inc. analysts said in a note, citing a surge in electric vehicle sales and conversations with local consumers.