WTI Crude Oil Extends Bearish Moves as US-Iran Talks Progress

WTI crude oil prices are on the decline for the second consecutive day into Wednesday as markets worry about potential oversupply as Iran could resume crude exports as talks with the US on limiting its nuclear program and lifting of sanctions make progress. At the time of writing, WTI crude oil is trading at around $64.59 per barrel.

Crude oil prices have been trading under pressure ever since news reports indicated positive developments in discussions between the US and Iran on reviving its deal to limit the scope of its nuclear program. A progress on this front could see the US lift sanctions on Iranian crude exports, adding more supply in markets at a time when the ongoing coronavirus crisis continues to weigh on demand.

WTI oil ended the previous session 1.1% lower and has already lost more than 1% of its value in early trading today. The risk-off mood in global markets has also impacted oil prices, driving them lower as investors sold off riskier assets and made their way towards safe havens instead.

However, losses in WTI crude oil prices were offset by the release of the API report in the previous session which indicated a smaller than forecast build in US crude inventories. According to the API, crude stockpiles in the US increased by 620k barrels during the past week against expectations of a 1.6 million barrel build, while gasoline and distillate inventories declined by 2.8 million barrels and 2.6 million barrels during the period.