Oil prices hover near seven-month highs amid the threat of military conflict in the Middle East that could disrupt supply
Oil prices are near their highest levels in the last half year ahead of US-Iran talks. The threat of military conflict that could disrupt supply continues to worry investors, pushing oil prices near seven-month highs on Wednesday. Talks between the two sides are scheduled for Thursday.
US envoys Steve Witkoff and Jared Kushner are scheduled to hold a third round of talks with the Iranian delegation in Geneva on Thursday. The US-Iran talks could prevent a conflict that could disrupt supply.
Brent futures rose 43 cents, or 0.6%, to $71.20 a barrel at 04:00 GMT. WTI futures rose 38 cents, or 0.6%, to $66.01.
Brent oil prices reached their highest level since July 31 on Friday, while WTI oil prices reached their highest level since August 4 on Monday.
A prolonged conflict could disrupt supply from Iran, the third-largest crude oil producer in the Organization of Petroleum Exporting Countries (OPEC), and other key production regions in the Middle East.
Due to various geopolitical uncertainties, the market will continue to price in a large risk premium and remain sensitive to new developments.
While geopolitical tensions support prices, the market is also grappling with concerns about large inventory increases due to global supply exceeding demand.
According to market sources, the American Petroleum Institute (API) reported late Tuesday a massive 11.43 million barrel increase in U.S. oil inventories for the week ending February 20. However, sources, citing API data, noted that gasoline and distillate fuel inventories had decreased.
Official U.S. oil inventory reports from the Energy Information Administration (EIA) will be released later on Wednesday.
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