Oil holds near seven-month high ahead of US-Iran talks

Oil prices hovered near seven-month highs on Tuesday as markets assessed supply risks amid rising tensions over Iran, ahead of renewed nuclear talks between Tehran and Washington.

Brent crude was little changed at $71.49 a barrel at 11:37 a.m. ET, compared with the previous session. US WTI crude rose by 11 cents, or 0.2 per cent, to $66.42 a barrel. Brent is trading at its highest level since late July, while WTI is close to levels last seen in early August.

The third round of negotiations on Iran’s nuclear programme is due to take place on Thursday in Geneva, Omani Foreign Minister Badr Albusaidi confirmed. The US is demanding that Iran abandon its nuclear programme, a condition Tehran rejects, insisting that its activities are peaceful.

Washington’s actions are also adding to tensions. The US State Department is withdrawing staff from its embassy in Beirut amid concerns over possible escalation. President Donald Trump has warned that if Iran does not reach an agreement, it will face a ‘very bad day’.

Analysts say the market is pricing in a geopolitical risk premium. ‘The risk is not only war itself, but also that escalation is difficult to stop once tensions have risen’, the financial group SEB said. US tariff policy is also contributing to uncertainty.

(reuters, max)