WTI slipped to around $65.00 a barrel in Asian trading on Friday, after small gains in the previous session. Prices moved as markets followed nuclear talks between the US and Iran.
Oil fell after Washington and Tehran agreed to keep negotiating next week, easing near-term supply concerns. Iranian Foreign Minister Abbas Araqchi said Thursday’s meeting was the most substantive so far, and outlined Iran’s push for sanctions relief and a process to lift restrictions.
Market Focus On Iran Talks
A source familiar with the US position said US officials were disappointed with the outcome. Talks are set to resume after consultations in both capitals, with technical-level meetings scheduled in Vienna next week.
Tehran said it will not allow enriched uranium to leave the country. The US has a large military presence in the Middle East, and President Donald Trump warned that military action is possible if no agreement is reached.
Separately, the US reportedly delayed the sale of overseas assets linked to Russia’s Lukoil. Reuters sources said OFAC will extend the deadline for related transactions from 28 February to 1 April.
This echoes what happened in 2025, when the possibility of a nuclear deal pushed WTI down toward $65 a barrel. That move was driven by expectations of more Iranian supply, not by actual barrels returning to the market. The market was clearly sensitive to supply risk, and even a small sign of sanctions relief triggered selling.
How Traders Can Approach Volatility
Those talks later broke down, and prices rebounded quickly once diplomacy stalled and sanctions stayed in place. Today, with WTI trading near $82, the market still carries a large risk premium because supply remains tight. In hindsight, the dip to $65 was a strong buying opportunity for traders who expected the deal to fail.
In the weeks ahead, traders should expect similar, headline-driven drops. These moves may also create opportunities. The CBOE Crude Oil Volatility Index (OVX) rose more than 15% during the tense negotiation periods in 2025, which boosted option premiums. One approach during sharp sell-offs is selling cash-secured puts on crude futures, aiming to collect the premium or potentially enter a long position at a lower price.
Fundamentals look stronger now than they did then. Recent EIA reports show US crude inventories fell by more than 5 million barrels over the past two weeks, against expectations for an increase. This points to stronger-than-expected demand and helps support prices—support that was not as clear during the 2025 talks.
OPEC+ has also signaled it will keep production cuts in place through next quarter, which keeps the market undersupplied. Unlike last year, the market is now more focused on a supply shortfall than on a possible supply surge from Iran. As a result, any weakness tied to renewed talks may be temporary unless a clear, verifiable agreement is announced.
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