Crude prices moved slightly lower on Tuesday in subdued, holiday-affected trading, as attention centered on imminent diplomatic talks between Washington and Tehran.
A firmer U.S. dollar ahead of several key economic releases and Federal Reserve signals later this week also weighed on energy markets.
Brent futures for April delivery declined 0.3% to $68.45 per barrel, while West Texas Intermediate futures gained 1.1% to $63.45 per barrel as of 21:00 ET (02:00 GMT). The advance in WTI was influenced by Monday’s U.S. holiday, which distorted price movements.
Activity was muted overall due to market closures across parts of Asia, including China, Hong Kong, Taiwan, South Korea, and Singapore.
U.S.–Iran discussions under scrutiny amid rising tensions
According to media reports, U.S. and Iranian officials are scheduled to meet in Geneva, Switzerland, on Tuesday to address Iran’s nuclear enrichment program.
U.S. President Donald Trump said on Monday that he would be “indirectly involved” in the talks, though he did not specify the nature of his participation.
The Geneva meeting follows earlier discussions between Tehran and Washington this month that failed to produce significant progress.
Reports also indicated that the U.S. had dispatched a second aircraft carrier to the Middle East ahead of the negotiations and was preparing contingency plans for a prolonged military operation should diplomacy break down.
Oil markets have factored in a higher geopolitical risk premium, reflecting concerns that escalating tensions in the region could threaten supply flows.
Stronger dollar pressures crude before key data
The U.S. dollar’s recent strength added further downward pressure on oil prices, with the greenback gaining ground in light trading conditions ahead of major economic updates.
On Tuesday, the dollar rose 0.2% against a basket of major currencies.
Investors are closely watching a series of U.S. economic indicators due this week, including industrial production figures, trade data, and notably the Personal Consumption Expenditures (PCE) price index. The PCE measure, the Federal Reserve’s preferred gauge of inflation, is expected to influence expectations around future interest rate decisions.
Minutes from the Fed’s January policy meeting are also scheduled for release and could provide additional insight into the central bank’s monetary policy outlook.