Oil prices slipped on Tuesday as signs of easing tensions between the US and Iran reduced geopolitical risk, encouraging investors to lock in gains after a recent rally.
International benchmark Brent crude traded at $65.78 per barrel at 9.20 a.m. local time (0620 GMT), down 0.7% from the previous close of $66.24.
US benchmark West Texas Intermediate (WTI) declined 0.6% to $61.62 per barrel, compared with $62.02 in the prior session.
Prices came under pressure as markets focused on renewed diplomatic activity between Washington and Tehran, easing fears of supply disruptions from the Middle East.
US President Donald Trump nevertheless struck a cautionary tone, warning Monday that "probably bad things will happen" if talks with Iran fail.
"We have ships heading to Iran right now, big ones, the biggest and the best, and we have talks going on with Iran. We'll see how it all works out," Trump told reporters at the White House. "But right now, we're talking to them. We're talking to Iran, and if we could work something out, that'd be great. And if we can't, probably bad things will happen."
Tensions between the two sides escalated sharply in June 2025, when Israel, backed by Washington, launched a 12-day assault on Iran targeting military and nuclear facilities as well as civilian infrastructure, killing senior commanders and scientists. Iran retaliated with missile and drone strikes on Israeli military and intelligence sites before the US carried out strikes on Iranian nuclear facilities.
In recent days, however, diplomatic efforts have intensified, with several regional countries, including Türkiye, seeking to ease tensions.
The Axios news website reported earlier Monday that Trump's special envoy, Steve Witkoff, and Iranian Foreign Minister Abbas Araghchi are expected to hold talks in Istanbul on Friday as part of renewed diplomatic efforts over Iran's nuclear program.
Iran's President Masoud Pezeshkian said he has instructed the country's foreign minister to pursue "fair and equitable negotiations" with the US. In a social media post on Tuesday, Pezeshkian said the directive was issued "in light of requests from friendly governments in the region" urging Iran to respond to a proposal by Trump for negotiations.
- Markets also react to Trump's announcement of new deal with India
Oil markets also reacted to trade developments after Trump announced a new deal with India that lowers US reciprocal tariffs from 25% to 18%.
Trump said Modi "agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela."
The US had first imposed a 25% tariff on Indian goods and later doubled it to 50% due to India's continued Russian oil imports.
Meanwhile, eight members of the OPEC+ group, comprising the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC producers, reiterated their commitment to supporting stability in oil markets in line with what they described as healthy market conditions during an online meeting held on Sunday.
The eight countries, Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman, confirmed their decision to halt production increases in March due to seasonal factors, noting that the 1.65 million barrels per day of output could be gradually restored depending on market conditions.
The meeting also emphasized full compliance with voluntary production cuts and compensation for any overproduction, adding that market conditions would be monitored on a monthly basis and that the next meeting would be held on March 1, 2026.
Keeping production steady, in line with expectations, continues to add downward pressure on oil prices.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr
