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Geopolitics · Oil Market · US-Iran · WTI Crude
WTI US Oil trades near $65.40 per barrel, stabilizing as geopolitical risk from US-Iran nuclear talks, including potential military action, is counterbalanced by a record 15.989 million barrel surge in US crude inventories, the largest build since February 2023.
The market is assessing the balance between Middle East geopolitical risks and signals of excess supply from the United States. The third round of nuclear talks between the US and Iran in Geneva is a focal point, with US President Donald Trump raising the possibility of military action and Tehran warning of retaliation.
This maintains a geopolitical risk premium, estimated by ING Group analysts at around $10 per barrel, embedded in oil prices, as reported by Reuters. However, upside potential for WTI is capped by heavier fundamentals.
The Energy Information Administration (EIA) reported a significant increase in US Crude inventories, following a 9.014 million barrel draw the previous week, reviving concerns about ample supply. Further supply increases are expected as Saudi Arabia approaches its highest crude oil export levels in nearly three years, Iran accelerates tanker loadings, and the US Department of the Treasury authorizes companies to resell Venezuelan oil to Cuba.
The outcome of the Washington-Tehran talks will provide clearer direction for WTI in the coming days.
US Oil Balances Iran Tensions, Record Inventory Build(current)
Oil prices nudged below $95 a barrel and U.S. stock futures were flat in placid early European trade, amid investor optimism around U.S.-Iran peace talks this week.
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