Oil prices steadied after a recent decline, with investors closely watching signs of strain in the US economy and developments in nuclear talks with Iran.
๐น Market Snapshot:
- Brent crude (BZ=F) slipped below $66 a barrel after falling 1.5% on Monday.
- West Texas Intermediate (CL=F) hovered near $62.
US manufacturing activity weakened significantly, highlighting the economic drag from President Trump’s tariffs. More economic data due this week is expected to provide deeper insights.
๐น Geopolitical Focus:
- Talks between Washington and Tehran show progress, raising the possibility of easing sanctions on Iranian oil.
- Iran is also presenting its sanctioned economy as an investment opportunity to US businesses.
๐น Oil Market Dynamics:
- Brent crude is heading for its largest monthly drop since August 2022, pressured by Trump’s escalating tariffs and OPEC+ plans to ramp up production.
- While many nations are negotiating with Washington, Beijing remains on the sidelines.
๐น Signs of Market Tightening:
- Market metrics show tightening in April: Brentโs spread between the June and July contracts widened in backwardation, with the June contract trading at a premiumโthe strongest in nearly three months.
๐น European Blackout:Spain and Portugal suffered Europe’s worst blackout in years, forcing several Spanish oil refineries to halt operations. Power is now gradually being restored.