Oil Steady Ahead of Second Round of US-Iran Talks
Oil prices moved relatively stable in Monday trading, as investors weighed the market impact of nuclear talks between the United States and Iran, scheduled to resume Tuesday in Geneva. Price movements tended to be limited as market participants opted for a defensive stance ahead of potential shifts in sentiment from diplomacy or escalation.
Brent crude futures edged up 3 cents to $67.78 per barrel at 03:58 GMT, while WTI was at $62.91 per barrel, up 2 cents. There was no settlement for WTI on Monday due to a holiday in the United States, so energy market activity is expected to be quieter than usual.
Last week, both benchmarks posted weekly declines, with Brent down about 0.5% and WTI down 1%. Pressure arose after US President Donald Trump stated that Washington could reach a deal with Tehran within a month, which temporarily depressed geopolitical risk premiums and prompted a price correction.
However, uncertainty remains high ahead of the second round of US-Iran talks. Iran is said to want a deal that offers economic benefits to both parties, including investment opportunities in the energy and mining sectors and aircraft purchases. However, several analysts believe the chances of a quick agreement remain low, as both parties are expected to stick to their respective "red lines."
The risk of escalation has also come back into the spotlight after the US sent a second aircraft carrier to the region and prepared the option of a sustained military campaign if talks fail, according to US officials. Meanwhile, Iran's Revolutionary Guard warned of potential retaliation against US military bases in the event of an attack on Iranian territory—a scenario that could trigger a surge in volatility and a risk premium in oil prices.
Amid these tensions, OPEC+ is said to be leaning toward resuming production increases starting in April after a three-month pause, considering meeting peak summer demand. Meanwhile, global market liquidity is potentially thin due to the Lunar New Year holidays in China, South Korea, and Taiwan, plus the Presidents' Day holiday in the US. With minimal indications of Chinese demand, the market is considered more vulnerable to erratic price movements, and in the near term, geopolitical factors and inventory data will remain the main triggers for two-way swings. (asd)
Source: Newsmaker.id
