Oil prices fell around one percent on Tuesday as investors weighed the prospect of increased global supply amid progress in U.S.-Iran nuclear talks and expectations of a production hike by OPEC+ later this week.
Brent crude futures ended the session down 65 cents, or one percent, at $64.09 per barrel, while U.S. West Texas Intermediate crude slipped 64 cents, or 1.04 percent, to close at $60.89 per barrel.
Although the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, are not expected to alter current output levels at their policy meeting on Wednesday, a separate meeting on Saturday is widely anticipated to result in an agreement to accelerate oil production increases starting in July.
Market sentiment has also been influenced by the fifth round of indirect talks between Iranian and U.S. officials held in Rome last week. While both sides signaled modest progress, key sticking points—particularly around Iran’s uranium enrichment—remain unresolved.
The outcome of these negotiations could have significant implications for oil supply. A successful agreement may lift sanctions and allow more Iranian oil into the market, whereas a collapse in talks would keep current restrictions in place.
On the domestic front, preliminary data suggests that U.S. crude inventories likely increased by approximately 500,000 barrels last week, contributing further to supply concerns.
However, some factors helped limit the decline in prices. U.S. President Donald Trump’s decision to extend trade discussions with the European Union until July 9 eased immediate fears of tariff escalations that could dampen fuel demand. U.S. equity markets responded positively to the delay, helping stabilize investor sentiment.
Additionally, a wildfire in Alberta, Canada, forced a temporary shutdown of certain oil and gas production facilities, providing mild support to crude prices by tightening near-term supply.
Overall, traders are awaiting clearer signals from the upcoming OPEC+ meeting and the direction of U.S.-Iran negotiations to determine the next move in the global oil market.
