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Oil Climbs as US-Iran Nuclear Talks Keep Investors on Edge - BLOOMBERG
(Bloomberg) -- Oil inched higher on signs that talks between the US and Iran remain tense, rekindling fears of a military conflict that could disrupt supplies from the OPEC member.
West Texas Intermediate rose above $66 a barrel, erasing earlier losses of as much as 2.8%, after Iran’s state media reported that Tehran won’t allow enriched uranium to leave the country. The US and Iran are holding a third round of nuclear talks in Geneva, with just days to go until President Donald Trump’s deadline to strike a deal.
The enrichment of uranium remains a key sticking point for both sides, with US officials previously signaling that Iran would have to send such stocks of uranium to another country or dilute them. Failure to reach an agreement on this issue raises the specter of potential US military action in the Middle East, a region that accounts for roughly one-third of the world’s crude oil supply.
Prices had slumped earlier in the session after officials from Oman, which is mediating the discussions, said “creative and positive ideas” were exchanged. Both sets of negotiators adjourned for a break and discussions will resume later in the day, Oman’s foreign minister said in a post on X.
Oil has been caught between bearish expectations of a global glut this year and heightened geopolitical concerns over Iran.
On Thursday, signs of a softer market emerged, with a key gauge signaling oversupply in Brent crude for the first time outside of an expiry day since 2024. The spread between Brent and WTI — or the difference in price between two of the world’s key crude markers — widened to as much as $5.75 a barrel, the most since April 2024.
“North Sea markets show signs of weakness, but the market’s focus is on the outcome of Geneva talks,” said Giovanni Staunovo, a commodity analyst at UBS Group AG.
Trump said he preferred a diplomatic solution regarding Iran’s nuclear program but warned of consequences if no deal was agreed. The US has imposed new sanctions on over 30 entities supporting Iranian oil and weapons sales, ramping up pressure on Tehran ahead of the talks.
As tensions simmer in the Middle East, Saudi Arabia is on course to export the most crude in almost three years this month, while Iran has been rapidly filling up tankers in recent days. Combined flows from Iraq, Kuwait and the United Arab Emirates are also higher.
