Brent Extends Drop on Easing Geopolitical Tensions

Brent crude oil futures climbed toward $68 per barrel on Wednesday, extending gains from the previous session as geopolitical tensions resurfaced after the US downed an Iranian drone near a US aircraft carrier in the Arabian Sea. The incident unsettled energy markets, though President Donald Trump emphasized that diplomatic channels remain open, with the White House confirming US-Iran talks are still scheduled for Friday. Adding to tensions, Iranian vessels challenged a US-flagged oil tanker transiting the Strait of Hormuz, with US Central Command saying the IRGC harassed the Stena Imperative. Further support came from API data showing US crude inventories fell by 11.1 million barrels last week, the largest draw since June if confirmed by official figures. Meanwhile, OPEC+ expects oil demand to gradually pick up from March or April and will decide on March 1 whether to resume monthly output increases after a first-quarter pause.

Brent crude oil futures swung between small gains and losses at around $66.5 per barrel on Tuesday after falling for two straight sessions, pressured by easing geopolitical tensions and uncertainty over trade talks. The main focus was on possible nuclear negotiations between the United States and Iran. President Donald Trump said talks could start soon, and reports showed US military forces moving farther away from Iran, reducing fears of conflict in the region. Markets are also watching a potential US-India trade deal. Trump said tariffs on India could be reduced if India stops buying Russian oil. India has not confirmed this plan, but its imports of Russian crude have already dropped to the lowest level in more than three years. This has increased the amount of unsold Russian oil worldwide. Meanwhile, OPEC+ reaffirmed plans to keep production steady in March, maintaining ample supply conditions after pausing output hikes amid weak seasonal demand.

Brent crude oil futures fell below $66 per barrel on Tuesday, extending the biggest decline in six months as geopolitical tensions eased. The US and Iran announced that they would resume talks on Friday, aiming to revive diplomacy over Iran’s nuclear program and reduce the risk of a wider regional conflict. The renewed negotiations alleviated concerns about potential disruptions to Middle East oil supplies. Additionally, President Donald Trump slashed tariffs on Indian goods to 18% from 25% after Prime Minister Narendra Modi agreed to halt purchases of Russian oil and increase imports from the US and potentially Venezuela. Further weighing on prices, OPEC+ reaffirmed plans to keep production steady in March, maintaining ample supply conditions after pausing output hikes amid weak seasonal demand.