LONDON: World oil prices eased on Monday after Saudi Arabia and the United Arab Emirates opened pipelines bypassing the Strait of Hormuz, which Iran has repeatedly threatened to close, analysts said.
Brent North Sea crude for delivery in August slipped six cents to $102.34 per barrel in late morning deals in London, ahead of the contract's expiry later today.
New York's main contract, light sweet crude for August, dropped 41 cents to $86.69.
The UAE and Saudi pipelines create optional transport routes for crude, alleviating concerns that Iran could disrupt supplies in negotiations with the West over its nuclear programme, IG Markets said in a report.
"Very quietly and strategically Saudi Arabia and UAE have opened up pipelines that allow it to bypass the Strait of Hormuz which up until now has been the trump card for Iran in its bargaining with the West," it stated.
Reports estimated that the new links will more than double the total pipeline capacity bypassing the Strait of Hormuz to 6.5 million barrels per day, almost 40 percent of the route's 17-million-barrel daily traffic.
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