Oil below $83 as traders eye Iran nuclear talks

Associated Press

SINGAPORE (AP) — Oil dropped below $83 a barrel Tuesday in Asia as traders closely watched talks between Iran and six world powers over the Middle Eastern country's nuclear program.

Benchmark oil for July delivery was down 36 cents to $82.91 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 76 cents to settle at $83.27 in New York on Monday.

In London, Brent crude for August delivery was down 48 cents at $95.57 per barrel on the ICE Futures exchange.

Negotiators from Iran are in talks with counterparts from six world powers — the United States, Britain, France, Russia, China and Germany — Monday and Tuesday in Moscow, the third such meeting in recent months.

On Monday, Iran became more adamant that the world must ease the sanctions choking off its oil sales before it will curb activities that could be used to make nuclear arms. But the six world powers insisted that Tehran take the first conciliatory step.

Crude has plunged from $110 in February as fears eased that the U.S. or Israel would attack Iranian nuclear facilities and disrupt global oil supplies. Signs of slowing economic growth and oil demand in the U.S., Europe and China have also pushed prices lower.

"Softening Iranian tensions and deteriorating fundamentals are responsible for the majority of the correction," Morgan Stanley said in a report. "New signs of emerging market weakness, in China in particular, present downside risks to global demand growth. A fall in Brent to the low $90s is possible."

In other energy trading, heating oil was down 0.2 cent at $2.62 per gallon while gasoline futures fell 0.9 cent at $2.58 per gallon. Natural gas gained 1.4 cents at $2.65 per 1,000 cubic feet.

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