WTI traded near $62.80 a barrel during Asian hours on Monday. It opened above the prior close, then slipped slightly. US markets were closed for Presidents’ Day. Trading in Asia was also slow as China, South Korea, and Taiwan observed Lunar New Year holidays.
A second round of US-Iran talks is set for Tuesday in Geneva. Tehran has signaled it may offer nuclear concessions if the US addresses sanctions. The US has warned it could strike if talks fail and has increased its military presence in the region.
Key Geopolitical Talks Ahead
US-backed talks between Russia and Ukraine are also due to resume on Tuesday. Expectations for a fast breakthrough are low, and a near-term return of Russian oil flows to global markets looks unlikely. Slovakia’s Prime Minister Robert Fico said on Sunday that Ukraine is delaying the restart of a pipeline that carries Russian oil through Ukrainian territory to Eastern Europe.
Supply concerns also weighed on prices. Reuters reported that OPEC+ is leaning toward restarting output increases from April, after a three-month pause, ahead of peak summer demand. OPEC has 12 member countries and sets production quotas at meetings held twice a year.
WTI (West Texas Intermediate) is a US crude benchmark traded through the Cushing hub. Weekly inventory reports from the API and EIA can move prices. Their results are within 1% of each other about 75% of the time.
With WTI holding near $63 a barrel, the calm market may offer a chance to prepare for a large move. Major talks involving the US, Iran, Russia, and Ukraine take place this Tuesday, February 17, and could trigger volatility. We see this as a period to plan for a breakout, not to rely on sideways trading.
Because the outcomes of these meetings are hard to predict, options strategies that benefit from a sharp move may fit best. Implied volatility for March WTI options has risen to 38%, showing growing concern about the US-Iran negotiations. Traders may consider straddles or strangles, which can profit from a big move in either direction.
Options Positioning For Volatility
On the supply side, the case for lower prices is strengthening. That supports buying puts as a hedge or a directional trade. The latest EIA report showed a surprise inventory build of 2.3 million barrels last week. Reports also suggest OPEC+ may approve an output increase from April. If geopolitical risks fade, added supply could push prices back toward the low $60s.
At the same time, upside risk remains significant if talks break down. Prices jumped above $70 in the third quarter of 2025 after an earlier round of Iran negotiations collapsed unexpectedly. A similar outcome—especially alongside warnings of possible military action—could make call options or bull call spreads perform well.
The market’s caution also shows in CFTC positioning data, which indicates money managers cut net-long exposure for a second straight week. The Russia-Ukraine pipeline issue adds uncertainty, but the main focus is the US-Iran meeting in Geneva. We expect the current holding pattern to end quickly once the outcome becomes clear.
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