To update prices and add details

Bengaluru/London, June 19 (Reuters) - Oil prices were on track for a 9 percent weekly loss on Friday as traders assessed the impact of diminishing prospects for a U.S.-Iran ceasefire after talks scheduled for Switzerland were called off and Israeli attacks in Lebanon escalated.

By 1100 GMT, Brent crude futures had fallen 24 cents, or 0.3 percent, to $79.61 a barrel, heading for their second consecutive weekly loss.

The July contract, the front-month contract for U.S. West Texas Intermediate crude, rose 58 cents, or 0.8 percent, to $77.18 a barrel. The contract expires on Monday.

The most traded August contract for US crude settled at $75.87 a barrel.

Switzerland said that US talks with Iranian negotiators on a deal to end the conflict in the Middle East would not take place today after US Vice President J.D. Vance canceled plans to travel to the country, adding to the uncertainty over the possibility of reaching a permanent ceasefire.

"This reveals how bumpy the road ahead is to achieve a full and uninterrupted resumption of oil flow through the Strait," said Tamas Varga, an analyst at PVM Oil Associates.

He added, "There is no doubt that news about the ceasefire extension agreement will continue to influence public opinion."

Both crude oil benchmarks fell to their lowest levels since early March on Thursday after several tankers, including three flying the Saudi flag and carrying six million barrels of crude oil, crossed the Strait of Hormuz hours after US President Donald Trump signed the agreement with Iran to end the trade war between them.

Analysts expect the agreement to release more than 85 million barrels of oil currently trapped in the Gulf region of the Middle East into global markets. The agreement also includes the lifting of US sanctions on Iranian oil, which will further increase supplies.

Before the war, roughly 20 percent of the world's oil and liquefied natural gas supplies passed through the strait, but a recovery in flows and production following the US-Iran agreement could take several months.

Citi said its most likely scenario, at 60 percent, is that oil flows will continue to normalize, crude markets will turn surplus, and prices will gradually fall to between $60 and $65 a barrel within six to 12 months by the first quarter of 2027.

Commerzbank indicated that oil supplies would gradually recover, and lowered its forecast for Brent crude to $80 a barrel by the end of the year from $85, predicting that prices would remain above pre-war levels for most of next year.

Iraqi Oil Minister Bassem Mohammed said the oil fields are ready to resume extraction operations, and that the return to normal "will be done gradually until previous production rates are reached."

On the demand side, the Organization of the Petroleum Exporting Countries (OPEC) said in its World Oil Outlook 2026 that global demand will rise to 113.3 million barrels per day in 2030 from 105.1 million barrels per day in 2025.

But Israel continues its war against Hezbollah in Lebanon, raising questions about whether the US-Iran peace agreement will hold.