London, February 3, 2026, 11:35 (GMT) — Regular session.
- Brent steadies around $66 a barrel after a one-week low earlier in the session
- Traders weigh U.S.-Iran thaw signals against an unchanged March supply stance
- A U.S.-India trade deal adds new uncertainty around Russian crude flows
Brent crude futures rose 7 cents, or 0.1%, to $66.37 a barrel by 1048 GMT, recovering from an early dip to $65.19, the lowest in a week. U.S. West Texas Intermediate was up 13 cents at $62.27 after both benchmarks slid more than 4% on Monday; Cavendish analysts said “rapid shifts in financial flows” had amplified the moves. OANDA senior market analyst Kelvin Wong said the swings tracked a “geopolitical risk premium” — the extra dollars paid for crude when traders fear supply disruption — tied to Washington’s on-off threats toward Iran. (Reuters)
The market has been repricing since Donald Trump said Iran was “seriously talking” with Washington and officials from both sides said nuclear talks would resume on Friday in Turkey. Brent fell $3.02, or 4.4%, to settle at $66.30 on Monday, while WTI slid $3.07, or 4.7%, to $62.14. Phillip Nova analyst Priyanka Sachdeva said the threats had kept a bid under oil through January, and the dollar firmed after Trump nominated Kevin Warsh as the next Federal Reserve chair. (Reuters)
On the supply side, Organization of the Petroleum Exporting Countries and allies, a group known as OPEC+, agreed on Sunday to keep output unchanged for March. Brent closed near $70 a barrel on Friday, close to the six-month high of $71.89 hit on Thursday, before this week’s slide. Rystad Energy geopolitical analyst Jorge Leon said the group was keeping “all options firmly on the table” as uncertainty around Iran and the U.S. persists. (Reuters)
Russian Deputy Prime Minister Alexander Novak said the global market was balanced and demand should rise in March and April. “Starting from around March or April, demand has been gradually increasing,” he told reporters when asked about OPEC+ plans. (Reuters)
The U.S. and India struck a trade deal that cuts U.S. tariffs on Indian goods to 18% from 50% in exchange for India halting Russian oil purchases and lowering trade barriers, Trump said. He said India would buy more U.S. energy, coal, technology and farm products. Indian refiners have been diversifying supply, but will need a wind-down period to exit existing Russian contracts, a government official told Reuters. (Reuters)
Any quick shift by India away from Russian crude could leave more barrels hunting for buyers elsewhere, putting pressure on discounts and freight. That is not a clean story either; policy and politics do not always move on shipping schedules.
The dollar has been part of the story, too. A stronger greenback makes oil priced in dollars more expensive for buyers using other currencies, and that can pinch demand at the margin.
After a January driven by geopolitics and weather, focus is drifting back to how much crude ends up in storage later this year. If inventories build, rallies can stall even with OPEC+ holding supply steady.
But Friday’s talks may not deliver. If diplomacy breaks down or rhetoric hardens again, risk premiums can return quickly and the market will have to reprice the tail risk.
