Iran calls for US to lift blockade as proof it wants peace

Prospects for a diplomatic end to the war require the United States (US) to lift its naval blockade and demonstrate a serious commitment to negotiations, Iran’s Foreign Minister Abbas Araghchi said on Wednesday, according to Bloomberg.

Araghchi said: “Iran is prepared to give diplomacy another chance if we see strong evidence of a sincere desire on the part of the US to achieve a just and honourable solution to permanently end this conflict,”

In a sharp escalation of Tehran’s warnings, an Iranian official threatened to target US political figures should American strikes resume, Fars News reported.

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In a separate development early Wednesday, the Saudi-led coalition announced that it had intercepted and destroyed five drones heading towards Saudi Arabia.

According to two US officials and two people familiar with the matter, the US military has been quietly reducing troop numbers at bases throughout the Middle East over recent days.

How is WTI reacting?

West Texas Intermediate (WTI) is trading at $97.60 at the time of writing, a decline of 0.32% for the day.

WTI Oil: Key Questions Answered

What distinguishes WTI Oil?

Among the Crude Oil varieties traded internationally, WTI, short for West Texas Intermediate, is one of three major types alongside Brent and Dubai Crude. Its relatively low gravity and sulphur content earn it the descriptions “light” and “sweet”, respectively. Regarded as a high-quality Oil, it is easy to refine. Produced in the United States, WTI is distributed through the Cushing hub, known as “The Pipeline Crossroads of the World”. As an Oil market benchmark, its price is regularly cited in media coverage.

What determines WTI Oil prices?

Supply and demand underpin WTI Oil prices, as they do those of other assets. Stronger global growth can lift demand, while weaker growth can have the reverse effect. Supply disruptions caused by political instability, wars or sanctions can also affect prices. Another major influence is policy set by OPEC, a group of leading Oil-producing countries. With Oil traded mainly in US Dollars, the value of the US Dollar also matters for WTI Crude Oil prices: a weaker currency can make Oil more affordable, while a stronger one can do the opposite.

Why do inventory reports matter for WTI Oil prices?

WTI Oil prices respond to weekly inventory figures from the American Petroleum Institute (API) and the Energy Information Agency (EIA), as stock changes reflect shifts in supply and demand. Falling inventories may signal stronger demand and push Oil prices higher. Rising stocks, by contrast, can indicate greater supply and weigh on prices. The API releases its report each Tuesday, followed by the EIA the next day. The two sets of figures tend to be similar, coming within 1% of each other 75% of the time. As the EIA is a government agency, its data is regarded as more reliable.

How do OPEC’s decisions affect WTI Oil prices?

At meetings held twice a year, the 12 Oil-producing nations that make up OPEC (Organization of the Petroleum Exporting Countries) jointly set production quotas for member countries. These decisions frequently influence WTI Oil prices. Lower quotas can restrict supply and lift Oil prices; increased production can have the reverse effect. The broader OPEC+ grouping includes ten additional countries outside OPEC, with Russia the most notable member.