During Friday’s trading session, oil prices fell after a brief spike driven by growing uncertainty surrounding nuclear negotiations between the United States and Iran. Brent crude briefly climbed above $65 per barrel before quickly retreating below that threshold. Meanwhile, WTI hovered around $61. The price surge was largely fueled by comments from Iran’s foreign minister, who publicly criticized the inconsistency of Washington’s stance in the negotiations. The market’s swift response highlights just how sensitive oil prices remain to geopolitical tensions, especially those involving major exporters.
One of the key elements currently influencing oil valuations is the prospect of a renewed nuclear agreement, which could pave the way for increased Iranian oil exports. Analysts estimate that such a deal could lead to an additional 200,000 to 300,000 barrels per day entering global markets. While these figures are significant, many experts argue that in the broader context of global supply, Iranian oil would have a limited impact on the overall balance.
Of greater significance to future price trends are projections from the International Energy Agency (IEA), which expects oil production—including new output and volumes returning from OPEC+ countries—to grow faster than global demand. According to the IEA, supply growth in 2025 will likely outpace consumption, potentially resulting in an oversupplied market and further downward pressure on prices. This scenario is particularly plausible if the global economic recovery unfolds more slowly than previously anticipated.
Despite the short-term price rebound, oil prices posted only a modest weekly gain. This was largely driven by increasing optimism about future demand, fueled by easing trade tensions between the U.S. and China. However, the broader outlook remains less positive. Since the beginning of the year, oil prices have declined by over 10%, a result of several converging factors—including persistent global uncertainty, economic slowdowns in various countries, and a sharp rise in supply not only from OPEC+ members but also from independent producers such as the United States and Brazil.
These dynamics continue to create a highly volatile environment for the oil market, with pricing outlooks remaining deeply uncertain. In the coming months, the most influential factors will include the outcome of U.S.–Iran nuclear talks, the pace of global economic recovery, the strategies adopted by OPEC+, and the behavior of the world’s largest oil consumers and producers.
Author: Krzysztof Kamiński – Oanda TMS
Source: CEO.com.pl
