Oil prices edge lower with US-Iran talks in focus
Oil prices edged lower in quiet Asian trading on Tuesday (February 17th), as market attention focused on the US-Iran nuclear talks in Geneva. Brent fell 0.86% to $68.06/barrel, while WTI edged up to $63.21/barrel after rallying in the previous session.
This limited movement occurred amid below-average trading volume, as many Asian markets were closed for the Lunar New Year holiday and North American markets were just returning to activity after a break. Thin liquidity conditions make prices volatile even without major fundamental changes.
The main focus is on the indirect US-Iran meeting mediated by Oman. Reuters reports that closed-door talks are scheduled to begin at 9:00 a.m. Geneva time (08:00 GMT / around 3:00 p.m. WIB), with US envoys Steve Witkoff and Jared Kushner, along with Iranian Foreign Minister Abbas Araqchi, in the negotiations.
At the same time, geopolitical risks are again heating up the risk premium on oil. Iran is holding military exercises in the Strait of Hormuz—a vital waterway carrying about a fifth of global oil shipments—just ahead of negotiations. The market believes any escalation in this corridor could quickly alter supply calculations.
From Washington, President Donald Trump stated that he would engage "indirectly" and assessed that Tehran wants to reach a deal, but still signaled strong consequences if diplomacy fails. Reuters also reported that the US is increasing its military posture in the region and preparing the option of a longer operation if negotiations collapse—making the market even more sensitive to headlines.
Beyond Geneva, the market is also monitoring parallel geopolitical agendas, including plans for Russia-Ukraine talks in the same city. Although the chances of a quick peace deal are considered slim, any progress could influence perceptions of global supply and contribute to energy sentiment.
Going forward, oil's direction tends to be determined by "headline risk": if the US-Iran talks signal a de-escalation, the risk premium could quickly diminish and put pressure on Brent; conversely, if there is a deadlock or a threat of an increase, oil could potentially rebound with sharper movements as liquidity remains thin at the start of the week. (yds)
Source: Newsmaker.id
