Oil Prices Edge Lower As Markets Await Signals From U.S.-Iran Negotiations

Oil Prices Ease Amid Political Signals and Supply Concerns

Brent oil futures for July fell 0.4% to $110.87 a barrel by 23:35 ET (03:35 GMT), while West Texas Intermediate (WTI) crude futures declined 0.3% to $98.87 a barrel. Both benchmarks had already fallen about 1% on Tuesday.

U.S. President Donald Trump told lawmakers on Tuesday evening that the Iran war could end “very quickly.” Earlier in the week, he said he had postponed a planned attack on Iran and indicated that negotiations with Tehran were progressing well. Vice President JD Vance also expressed optimism regarding the conflict, stating that Tehran wanted to make a deal.

Despite the softer prices, crude losses were capped by signs of persistent supply disruptions in the Strait of Hormuz. Traffic through the key waterway reportedly remained at a fraction of pre-war levels, affecting about 20% of global oil supply. Separately, the United States on Monday extended a sanctions waiver on seaborne Russian oil, aimed at allowing countries vulnerable to oil import disruptions to secure supply.

Inventory Drawdowns and Policy Actions Support Market

Market focus is now turning to upcoming U.S. inventory data for further indications on supply conditions amid continued disruptions linked to the Iran war. Preliminary figures from the American Petroleum Institute (API) showed a 9.1 million barrel draw in crude stockpiles last week, significantly larger than expectations for a 3.4 million barrel decline. API data is often viewed as a precursor to the official inventory report, which is due later on Wednesday.

U.S. crude inventories have been drawn down sharply in recent weeks as the country increased oil exports to help offset overseas supply shocks stemming from the Iran conflict. President Trump previously ordered the release of 172 million barrels of oil from the Strategic Petroleum Reserve to mitigate supply disruptions.

On the diplomatic front, Iran’s latest peace proposal, reported by state media on Tuesday, called for ending hostilities on all fronts, the withdrawal of U.S. forces from the region, and reparations for war-related damage. The United States has largely rejected earlier Iranian proposals, maintaining that ending Iran’s nuclear ambitions remains a key condition in any agreement.

FAQ

What are the latest Brent and WTI prices mentioned?
Brent oil futures for July traded at $110.87 a barrel, down 0.4%, while WTI crude futures were at $98.87 a barrel, down 0.3% by 23:35 ET (03:35 GMT).

How large was the recent U.S. crude inventory draw reported by API?
The American Petroleum Institute reported a 9.1 million barrel draw in U.S. crude inventories last week, compared with expectations for a 3.4 million barrel draw.

What measures has the U.S. taken to address oil supply disruptions?
The U.S. extended a sanctions waiver on seaborne Russian oil to help vulnerable importers secure supply and ordered the release of 172 million barrels from the Strategic Petroleum Reserve to ease supply shocks from the Iran conflict.

What are the key elements of Iran’s latest peace proposal?
According to state media, Iran proposed ending hostilities on all fronts, the exit of U.S. forces from the region, and reparations for damage resulting from the war.