WASHINGTON: Oil prices hovered near seven-month highs on Wednesday as investors remained concerned about a potential military conflict between the United States and Iran, even as the two sides prepare for talks on Thursday. Brent crude futures rose 45 cents, or 0.64%, to $71.22 per barrel at 0140 GMT, while West Texas Intermediate (WTI) futures increased 42 cents, or 0.64%, to $66.05 per barrel.
Brent reached its highest level since July 31 last week, and WTI hit its highest since August 4 on Monday, with prices remaining elevated as the US deploys military forces in the Middle East to push Iran toward negotiations over its nuclear and ballistic missile programs. An extended conflict could disrupt oil supplies from Iranâthe third-largest crude producer in OPECâand other key producers in the region.
US envoys Steve Witkoff and Jared Kushner are scheduled to meet an Iranian delegation in Geneva for a third round of talks on Thursday. Iranâs Foreign Minister Abbas Araqchi said a deal with the US is âwithin reach, but only if diplomacy is given priority.â Market analysts remain cautious.
Tony Sycamore of IG noted, âPresident Trump has warned that without a deal, there will be âvery bad consequences.â Whether Iranâs concessions will meet the USâs âzero enrichmentâ red line remains to be seen.âReuters sources reported that Iran and China have accelerated negotiations for Chinese anti-ship cruise missiles, which could potentially target US naval forces in the region.
Experts say such missiles would significantly enhance Iranâs strike capabilities. While geopolitical tensions support higher prices, global supply exceeding demand is also affecting the market.
The American Petroleum Institute reported a sharp increase in US oil stockpiles of 11.43 million barrels for the week ending February 20, although gasoline and distillate inventories fell. Official inventory figures from the Energy Information Administration are expected later on Wednesday.
