"The absence of any firm decisions following diplomatic talks has kept the geopolitical risk premium alive, supporting prices. While the meeting in Oman last week had initially offered some relief to market sentiment, the optimism has been tempered by reports that the US is considering deploying a second carrier strike group to the Middle East and may begin intercepting tankers carrying Iranian crude if nuclear negotiations collapse."
"However, the market faces headwinds from the bearish data released by the US Energy Information Administration (EIA). US crude stockpiles surged by 8.5 million barrels last week, a figure that exceeded expectations of a much smaller increase and confirmed earlier API data hinting at a build-up. On a broader scale, the narrative of a 2026 surplus remains present and could continue to weigh on prices."
Oil prices were volatile as markets weighed geopolitical developments and inventory figures. Unresolved tensions between the United States and Iran sustained a geopolitical risk premium that supported prices. Diplomatic talks produced no firm decisions, and reports that the US may deploy a second carrier strike group and intercept tankers if nuclear talks fail damped earlier optimism from the Oman meeting. Bearish fundamentals emerged after the US Energy Information Administration reported a surprise 8.5 million-barrel build in crude stocks, confirming API indications. Expectations of a 2026 supply surplus added longer-term downward pressure on prices.
Read at London Business News | Londonlovesbusiness.com
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