- Crude oil prices remained steady with WTI near $62.8 and Brent below $68 per barrel
- Oil fell after two weeks of decline amid geopolitical tensions and supply concerns
- US-Iran nuclear talks begin Tuesday, impacting future global oil supply prospects
Crude oil prices were largely unchanged at the start of the week, with West Texas Intermediate (WTI) hovering near $62.8 per barrel and Brent crude trading below $68. The pause comes after oil recorded its first consecutive weekly decline of the year, as traders weighed geopolitical tensions against growing concerns of excess global supply.
Oil had rallied nearly 10% earlier this year amid fears of supply disruptions linked to tensions involving Iran and ongoing conflict in Ukraine. However, fading concerns of immediate escalation and rising supply expectations have since tempered the momentum.
Iran Talks Take Center Stage
Investor focus has shifted to the second round of nuclear negotiations between the US and Iran, scheduled to begin Tuesday in Geneva. Iranian officials have signalled openness to compromise, provided discussions include easing US sanctions. The outcome could significantly influence global oil supply, given Iran's position as a key producer.
At the same time, rhetoric from US leadership has kept tensions elevated, underscoring the uncertainty surrounding the negotiations. Any breakthrough could ease geopolitical risk premiums, while continued deadlock may sustain volatility.
Separately, US-led diplomatic efforts to end the Ukraine conflict are also set to begin this week. While these talks could potentially pave the way for Russian oil to re-enter global markets, expectations for a quick resolution remain low. Recent drone attacks on infrastructure near the Black Sea further highlight the fragile security environment and ongoing supply risks.
Supply Glut Concerns Weigh on Prices
Despite geopolitical flashpoints, oil markets are increasingly focused on supply fundamentals. Some OPEC+ members believe there is room to increase output starting April, though no formal decision has been made ahead of the group's March meeting.
Meanwhile, the International Energy Agency has reiterated its expectation of a significant supply surplus in 2026 and downgraded its demand growth outlook. These projections have reinforced concerns that ample supply could cap oil prices, even as geopolitical developments continue to drive short-term volatility.
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