Oil prices dropped about 1% on Thursday, down for a third consecutive day, after Qatar said Iran and the ​US had made progress in indirect talks focused on the Strait of ‌Hormuz, which handled one-fifth of global oil supply before the war.

Brent futures lost ⁠77 cents or 1.1% to $70.80 a barrel by 0256 GMT, while US ​West Texas Intermediate crude fell 84 cents or 1.2% to $67.74 a barrel.

Both benchmarks also ​fell more than 1% in the previous session, hitting their lowest levels in four months.

The Doha talks produced “positive progress” on issues related to the memorandum that halted the war in June, a Qatar Foreign Ministry spokesperson ​said in a post on X.

There was, however, no sign that the ​two sides had made headway towards a lasting peace.

As the strait stays open and crude oil flows out, there are growing expectations of oversupply and ​competition for market share is pushing prices down, Haitong Futures said in a ​note.

OPEC+ oil-producing countries will likely agree to a further hike in their output targets from August when ‌they ⁠meet on Sunday, sources said on Wednesday.

UBS on Thursday cut its Brent forecasts citing the US-Iran memorandum of understanding and the subsequent increase in oil shipping through the Strait of Hormuz.

It cut its average Brent price forecast for the September quarter ​by $25 and for ​the December quarter ⁠by $10. The bank now expects the benchmark to average $80 a barrel during the second half of the year and $75 in ​2027.

“Despite this, we believe it is premature to assume a full ​normalisation, & ⁠see price risk skewed to the upside noting that inbound tankers to the Persian Gulf have lagged outbound tankers,” UBS said.

The next meeting between Iran and US negotiators will ⁠take ​place after funeral processions for Iran’s late Supreme ​Leader Ayatollah Ali Khamenei on July 9, Qatar’s Foreign Ministry also said.