Oil rises 2% as US, Iran extend talks to next week

Oil prices rose by more than $1 per barrel on Friday, as traders remained on alert over potential supply disruptions after the United States and Iran agreed to extend nuclear negotiations.

Brent crude futures climbed $1.38, or 1.95%, to $72.13 per barrel by 11:10 GMT, while US West Texas Intermediate crude rose $1.40, or 2.15%, to $66.61 per barrel.

Tamas Varga, oil analyst at brokerage PVM, said uncertainty continues to dominate the market, with fears pushing prices higher, noting that current moves are entirely driven by the outcome of the Iranian nuclear talks and the possibility of US military action against Tehran.

Limited weekly gains

On a weekly basis, Brent crude is heading for a modest gain of about 0.2%, while West Texas Intermediate is set for a marginal decline of 0.1%.

The United States and Iran held indirect talks in Geneva on Thursday, after US President Donald Trump ordered a military buildup in the region.

During the negotiations, oil prices jumped by more than $1 per barrel following media reports suggesting discussions had stalled due to Washington’s insistence on a full halt to Iran’s uranium enrichment. However, gains were trimmed after the Omani mediator announced progress in the talks.

Omani Foreign Minister Badr Albusaidi said both sides plan to resume negotiations next week, with technical-level discussions scheduled to take place in Vienna.

Suvro Sarkar, analyst at DBS Bank, said the latest round of talks provides some hope for a peaceful resolution, but stressed that military strikes remain a possible scenario.

Trump stated on February 19 that Iran must reach a deal on its nuclear program within 10 to 15 days, otherwise “very bad things” would happen.

Sarkar estimated that the geopolitical risk premium currently embedded in oil prices ranges between $8 and $10 per barrel, amid fears that any conflict could disrupt Middle East supply flows through the Strait of Hormuz, which handles around 20% of global oil supply.

Saudi moves and OPEC+ meeting in focus

To mitigate the impact of a potential strike, informed sources said Saudi Arabia is working to increase oil production and exports.

At the same time, OPEC+ is expected to consider raising output by about 137,000 barrels per day for April during its meeting scheduled for March 1, after previously pausing production increases in the first quarter of the year.