Oil edged lower in a choppy session as broader financial markets weakened and uncertainty lingered about whether sanctions on Iran will be loosened or tightened.
Prices whipsawed after Iran’s supreme leader expressed skepticism over discussions with the US, further denting expectations of an agreement on his country’s nuclear program. Ayatollah Ali Khamenei said he doesn’t think negotiations with the US will succeed and urged the Trump administration to stop “talking nonsense.” He added he doesn’t know what will happen in any discussions.
US West Texas Intermediate’s most-active July futures contract declined 0.2% to settle just above $62 a barrel. Brent also edged lower but still settled above $65 for the third consecutive session.
Oil prices have been volatile since last week on mixed headlines about the fate of Iran-US talks, which could pave the way for more barrels to return to a market that’s expected to be oversupplied later in the year. Adding to global uncertainty, US President Donald Trump is pulling back from his efforts to end the war between Ukraine and Russia.
“It’s just a road to ‘nowhere’ for crude right now until more is known about how the OPEC, Iran, and Russian sagas play out,” said Dennis Kissler, senior vice president for trading at BOK Financial Securities.
Crude has rebounded this month, after sliding 19% in April, following an easing in the trade war between the US and China. In bullish sign for prices, premiums of several refined fuels over crude have surged over recent weeks, potentially bolstering demand for crude oil.
Elsewhere, ConocoPhillips Chief Executive Officer Ryan Lance said he doesn’t think US shale output has peaked. Prices in the $50s on a sustained basis would lead to a slow decline, but in the $60s, output will just plateau, he added. Traders have been watching for signs of the effect of lower oil prices on US supply.
Oil Prices
WTI for July delivery fell 0.2% to settle at $62.03 in New York.
June futures expire Tuesday.
Brent declined 0.2% to settle at $65.38 a barrel.
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