Oil Set for Weekly Decline as US-Iran talks Ease Supply Fears

Oil prices edged lower on Friday, poised for a weekly drop as renewed diplomatic talks between the United States and Iran eased fears of potential hostilities that could disrupt crude supply.

Brent crude futures slipped to about $70.70 a barrel, while U.S. West Texas Intermediate (WTI) hovered near $65.20, reversing some of the previous week’s gains and marking a roughly 1.8% weekly fall for Brent and about a 2.2% drop for WTI.

Traders reacted to extended indirect talks in Geneva over Iran’s contentious nuclear program, which had been a key source of geopolitical risk premium in oil.

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The negotiations, aimed at averting a broader conflict after heightened tensions in the Middle East, have reportedly made some progress, although disagreements remain over issues such as Iran’s uranium enrichment levels.

Market participants were in a “wait-and-see” mode ahead of a scheduled OPEC+ meeting, where producers are expected to discuss a possible output increase. That prospect also weighed on prices, as prospects of higher supply temper any rally resulting solely from geopolitical tension.

Oil markets had been volatile in recent weeks on the back of U.S.-Iran developments and data on U.S. crude inventories. Prior reports showed sharp weekly builds in stockpiles — the largest in several years — which added bearish pressure to prices even as geopolitical concerns kept oil supported overall.

The ongoing diplomatic dialogue between Washington and Tehran, amid broader Middle Eastern and global economic considerations, continues to shape crude pricing dynamics as traders balance supply risks with potential increases in output and demand signals.