Oil prices inched down on Friday and were on track for a weekly decline after the United States and Iran extended nuclear talks, easing concerns about potential hostilities that could disrupt supply, while Opec+ may resume output hike at its Sunday meeting.
Brent crude futures lost five cents to US$70.70 a barrel by 0331 GMT. US West Texas Intermediate crude fell one cent to US$65.20.
For the week, Brent was heading for a 1.8% decline, while WTI was set to fall around 2.2%, reversing some of the previous week's gains.
"Traders are in wait-and-see mode heading into the weekend with Iran tensions mounting on one hand, and the Opec+ meeting on Sunday with a likely production hike on the other hand," said June Goh, a senior analyst at Sparta Commodities.
The United States and Iran held indirect talks in Geneva on Thursday over their long-running nuclear dispute to avert a conflict after US President Donald Trump ordered a military build-up in the region.
During the talks, oil prices gained more than a dollar a barrel after media reports indicated the discussions had stalled over US insistence on zero enrichment of uranium by Iran, as well as a demand for the delivery of all 60% enriched uranium to the United States.
However, prices eased after the Omani mediator said the two sides had made progress in their talks.
They plan to resume negotiations with technical-level discussions scheduled next week in Vienna, Omani Foreign Minister Sayyid Badr Albusaidi said in a post on X after the meetings in Geneva.
"While this initially allayed concerns of imminent US military action, it leaves little time to reach a deal before President Trump’s deadline of March 1-6," said Daniel Hynes, an analyst at ANZ.
Sparta's Goh said the tone from the talks indicated an unwillingness from both parties to concede, adding that the chance of a US strike on Iran is growing but any military action would likely be limited.
To cushion the impact from a possible strike, Saudi Arabia is increasing its oil production and exports as part of a contingency plan, two sources familiar with the plan had told Reuters.
Also, the Organization of the Petroleum Exporting Countries and their allies, a group known as Opec+, is likely to consider raising its oil output by 137,000 barrels per day for April at the March 1 meeting, sources said, after suspending production hikes in the first quarter.
Source: theedgemalaysia