Oil prices were little changed on Tuesday, with Brent crude slipping 0.3% to settle at $72.92 per barrel and WTI falling 1.8% to $69.50 per barrel, as markets balanced expectations for continued U.S.-Iran negotiations against improving global supply conditions.
Crude prices remained near their pre-conflict levels from late February, reflecting the continued unwinding of the geopolitical risk premium that had driven prices sharply higher during the four-month conflict. While technical discussions between U.S. and Iranian officials are expected to continue in Doha, hopes for a near-term comprehensive agreement were tempered after Qatari officials confirmed that no high-level negotiations would take place during the current round of talks.
Market sentiment also remained pressured by expectations of stronger future supply. U.S. crude production reached a record 13.93 million barrels per day in April, as higher prices earlier this year encouraged increased output. In addition, several market forecasts now anticipate a global oil surplus in 2027 as Middle Eastern exports continue to recover and additional production returns to the market.
For the month, Brent crude declined approximately 21%, while second-quarter prices fell about 38%, marking the largest monthly and quarterly declines since the market collapse during the COVID-19 pandemic in 2020. Despite the sharp correction, analysts noted that oil prices continue to receive some support from inventories, with expectations that U.S. crude stockpiles declined for a tenth consecutive week, reflecting ongoing strong seasonal demand and relatively tight physical supplies.