Oil Stabilizes After 4% Plunge: Market Awaits Iran
Oil prices stabilized on Tuesday (February 3rd) after falling more than 4% in the previous session, as the market began to reassess the global supply outlook and the likelihood of easing United States-Iran tensions.
Brent rose slightly to $66.47/barrel and WTI to $62.38/barrel.
On the supply side, Alexander Novak assessed the global oil market as currently "balanced" and predicted demand would gradually increase in March-April. At the same time, OPEC+ decided to maintain production levels for March, which helped curb volatility following the sharp decline.
Sentiment was dampened yesterday after Donald Trump said Iran was "serious" about opening talks, eroding the geopolitical risk premium that had previously boosted oil prices. Reuters also reported that nuclear talks were expected to resume Friday in Turkey, while Iranian President Masoud Pezeshkian emphasized that negotiations could proceed as long as "unreasonable" threats and demands were avoided.
On the other hand, the still-strong US dollar also acted as a brake, making dollar-denominated oil more expensive for non-dollar buyers. This factor limited the price recovery, despite a rebound after hitting a one-week low in the same session.
The market is also monitoring the impact of the new US-India trade deal. Trump announced that US tariffs on Indian goods would be cut to 18% in exchange for India reducing Russian oil purchases and switching to US (and possibly Venezuelan) purchases. This policy direction could alter the global crude oil flow map if fully executed.
Source: Newsmaker.id
