Oil Slips Below $100 as UN Diplomacy Gains Traction on Iran
Brent crude held below $100 a barrel as US and Iranian officials met Qatari mediators at the UN, and Saudi Arabia reopened its East-West Pipeline.
Oil prices eased over the past day as diplomatic activity around the United Nations General Assembly in New York raised hopes of progress on the Iran conflict. Brent crude remained below $100 a barrel early on Wednesday, having slipped under that mark a day earlier.
US and Iranian officials held behind-the-scenes talks with Qatari mediators at the UN on Tuesday. The meeting added to optimism generated by reports that Tehran was prepared to reopen the Strait of Hormuz within seven days if Washington lifted its shipping and economic blockades. Iranian President Masoud Pezeshkian was due to address the General Assembly on Wednesday, keeping alive the possibility of a meeting with President Donald Trump.
Trump repeated his threat to annihilate the Iranian government over its nuclear ambitions and its grip on energy waterways, but said he remained open to talks. He also stressed that he was not bound by the outcome of the US midterm elections, even as polls show his lowest approval ratings and betting markets lean toward a Democrat sweep of both houses of Congress.
Prices drew further support from news that Saudi Arabia was set to reopen its East-West Pipeline on Tuesday, earlier than markets had expected by several weeks.
Elsewhere, renewed optimism over artificial intelligence kept chip stocks buoyed, with the SOX semiconductor index adding another 2% on Tuesday. Technology investor SoftBank drew strong demand for a $10 billion bond sale that was on course to become the largest junk bond deal ever.
Global stocks and US futures were mostly flat early on Wednesday, with a US-China summit now in view for Thursday. Interest rate markets were calmer, though bond yields edged higher as more Federal Reserve officials underlined their impatience in bringing inflation back to target. The day's major economic releases include early September business surveys from around the world.
A recent poll showed Trump's public approval rating at 32%, the lowest of his political career and below equivalent ratings for his predecessor Joe Biden, as Republicans increasingly sour on his handling of the cost of living amid the Iran war. The survey, conducted last week, put approval of his economic management at 23%, with just 17% approving his record on the cost of living. For the first time, Republicans who disapprove of his handling of the cost of living outnumber those who approve, 51% to 44%.