Oil prices rose on Wednesday as investors weighed renewed geopolitical tension between the United States and Iran against a sharp increase in U.S. crude inventories. Brent crude futures settled up 60 cents, or 0.87%, at $69.40 per barrel. U.S. West Texas Intermediate crude gained 67 cents, or roughly 1.05%, to settle at $64.63.
Prices found support from concerns over U.S.-Iran relations as Washington and Tehran prepared to resume negotiations, despite limited signs of progress. President Donald Trump said on Wednesday that nothing definitive had been decided following talks with Israeli Prime Minister Benjamin Netanyahu, though negotiations with Iran would continue. Earlier this week, Trump said he was considering deploying a second aircraft carrier to the Middle East if a deal is not reached.
U.S. and Iranian officials held indirect talks in Oman last week amid a regional U.S. naval buildup, with the timing and location of the next round of discussions still unclear. Analysts noted that while rhetoric remains confrontational at times, there are no immediate signs of escalation.
Additional support came from stronger-than-expected U.S. labor data, with job growth accelerating in January and the unemployment rate falling to 4.3%, signaling continued economic resilience and steady demand for fuels.
Limiting gains, however, U.S. crude inventories surged by 8.5 million barrels to 428.8 million barrels last week, according to the Energy Information Administration. The build far exceeded analysts’ expectations of a 793,000-barrel increase, reflecting a rebound in domestic production near record levels.
Elsewhere, OPEC left its global supply and demand outlook largely unchanged in its monthly report, though it projected that demand for the group’s crude will decline by 400,000 barrels per day in the second quarter compared with the first. Russian oil output slipped about 0.6% in January from December, while Egypt announced plans to double oil production by 2030 by revising existing contracts to attract new investment.