LONDON, Feb 2, 2026, 11:43 GMT — Regular session
Brent crude futures dropped almost 5% on Monday, hovering near $65.9 a barrel. Talks of U.S.-Iran negotiations undercut worries about supply disruptions, trimming the geopolitical premium that had pushed prices higher last month. U.S. West Texas Intermediate followed suit, slipping roughly 5% to about $61.8.
The timing is crucial. Brent kicked off February near multi-month highs following a strong rally in January, but traders quickly pulled back as headlines shifted toward diplomacy instead of escalation.
Oil remains caught between politics and fundamentals. OPEC+ is sticking to current supply levels, but any change in perceived Middle East risk can quickly jolt prices—often well before actual supply is affected.
U.S. President Donald Trump said over the weekend that Iran was “seriously talking” with Washington. Tehran’s top security official, Ali Larijani, confirmed that arrangements for negotiations were underway, Reuters reported. UBS analyst Giovanni Staunovo noted that easing tensions, along with fewer supply disruptions in the U.S. and Kazakhstan, weighed on oil prices. Meanwhile, Phillip Nova analyst Priyanka Sachdeva highlighted a firmer dollar as another factor putting pressure on prices, given oil’s dollar pricing. Reuters
The slide followed a broad commodity selloff hitting metals and energy, as investors reevaluated U.S. rate prospects after Trump named Kevin Warsh as the next Federal Reserve chair. “A stronger U.S. dollar is also adding pressure on … other commodities, including oil,” said Vivek Dhar, commodities strategist at Commonwealth Bank of Australia, in a Reuters report. Reuters
OPEC+ decided to hold oil production steady through March, extending its pause on planned output increases, the group said. Jorge Leon, head of geopolitical analysis at Rystad Energy, called the absence of guidance beyond March “significant,” noting the cartel was “keeping all options firmly on the table.” Reuters reported the eight quota-setting members will reconvene on March 1. Reuters
OPEC’s secretariat confirmed it received updated “compensation” plans from Iraq, the United Arab Emirates, Kazakhstan, and Oman to offset production above their targets. These schedules extend through June. According to the organisation, Kazakhstan is set to shoulder the largest portion of the compensation cuts. Reuters
Demand remains a major question mark, particularly in Asia. Reuters columnist Clyde Russell pointed out that China — the globe’s top crude buyer — might scale back imports following Brent’s surge in January. Even so, geopolitical tensions are sustaining a risk premium, which he puts at about $7-$8 a barrel.
Despite January’s jump, Brent remains about 13% below where it stood a year ago, according to Trading Economics data tracking a CFD linked to the benchmark.
The market remains jittery and volatile. A pause in U.S.-Iran talks, fresh disruptions in major producing areas, or another surge in the dollar could send prices tumbling just as fast. Traders are well aware of how quickly the tape can reverse.
Investors will next zero in on any clearer schedule for Washington-Tehran negotiations and watch for signs of OPEC+ compliance. The cartel confirmed its Joint Ministerial Monitoring Committee will meet on April 5.
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