US oil prices extend losses on hopes of Iran-Oman talks on Strait of Hormuz

US oil prices continued to decline on Wednesday morning, furthering the previous day's drop, as market participants remained optimistic about the possibility of Iran and Oman discussing the reopening of the Strait of Hormuz. West Texas Intermediate crude futures dropped by US$1.37, or 1.7%, reaching US$80.99 per barrel as of 2240 GMT.

The contract had fallen by 3.1% on Tuesday, recording its lowest level since August 13. Iran announced the resumption of talks with Oman to manage the Strait, amid growing economic pressures exerted by the US under President Donald Trump. Iran and Oman had been engaged in intermittent discussions for several weeks regarding the regulation of maritime traffic through the waterway, which once accounted for one-fifth of global oil and liquefied natural gas shipments prior to the conflict that erupted in February.

The US recently broadened its sanctions regime to target Iran's economic resources, threatening penalties for nations that continue to engage in commercial dealings with Iran, although it had not implemented sanctions immediately at the time of the announcement.