Oil Gains Ahead of US-Iran Talks

WTI crude oil futures rose toward $66 per barrel on Thursday, halting a three-day decline as investors prepared for a third round of US-Iran nuclear talks later in the day. Markets were closely focused on the Geneva meeting amid heightened caution over the military buildup in the Middle East and Washington’s increased pressure on Iran through sanctions on entities involved in oil and weapons exports. The talks come as President Donald Trump warned that the US could carry out limited strikes if a nuclear agreement is not reached. However, gains were tempered by a sharp rise in US crude inventories, with EIA data showing a 16-million-barrel build last week, the largest weekly increase since February 2023. Oversupply concerns were further reinforced as Saudi Arabia moved toward its highest crude exports in nearly three years, while Iran accelerated tanker loadings, according to Vortexa data.

WTI crude oil futures fell to $65.37 per barrel on Wednesday, extending losses for a third session after the US Energy Information Administration reported the largest weekly crude inventory rise in three years. US crude stocks jumped 15.989 million barrels to 435.8 million for the week ended February 20, far above the expected 1.5 million-barrel increase. Cushing, Oklahoma, inventories rose 881,000 barrels, distillates increased, and gasoline stocks declined. Also, a Hezbollah official said the group would not intervene in limited US strikes on Iran. Still, oil prices remain near seven-month highs as traders weigh the next US-Iran nuclear talks in Geneva on Thursday. President Donald Trump warned Iran is rebuilding its nuclear program, fueling speculation of potential US military action.

WTI crude oil futures climbed past $66 per barrel on Wednesday as traders balanced geopolitical supply risks against a massive build in US inventories. Ahead of Thursday's high-stakes nuclear talks in Geneva involving envoys Steve Witkoff and Jared Kushner, President Trump used his State of the Union address to warn of "very bad consequences" if Iran fails to meet "zero enrichment" demands. Adding to the tension, reports surfaced that Iran is seeking Chinese anti-ship cruise missiles to counter US naval presence near its coast. This geopolitical risk premium remains high despite the American Petroleum Institute reporting a significant 11.43 million barrel surge in US crude stockpiles last week. While global supply currently exceeds demand, the market remains fixated on potential disruptions in the Strait of Hormuz. Investors are now awaiting official EIA inventory data and the outcome of diplomacy to see if prices can sustain these seven-month highs.