Oil prices edged lower on Tuesday as trading activity remained subdued due to several market holidays across Asia, while investors closely monitored forthcoming discussions between the United States and Iran.
A firmer U.S. dollar also added pressure to crude benchmarks ahead of a series of key economic reports and signals from the Federal Reserve later in the week.
April contracts for Brent crude slipped 0.3% to $68.45 per barrel. Meanwhile, West Texas Intermediate (WTI) crude gained 1.1% to $63.45 per barrel as of 21:00 ET (02:00 GMT), with the move partly influenced by the U.S. market closure on Monday.
Trading volumes were notably lighter as markets in China, Hong Kong, Taiwan, South Korea, and Singapore were closed for holidays.
U.S.-Iran talks draw attention amid rising tensions
Officials from the U.S. and Iran were scheduled to meet in Geneva on Tuesday to address concerns over Iran’s nuclear enrichment program, according to media reports. U.S. President Donald Trump indicated on Monday that he would be “indirectly involved” in the negotiations, though he did not provide further details.
The meeting follows earlier discussions between Washington and Tehran that ended without significant progress earlier this month.
Reports also indicated that the United States had sent a second aircraft carrier to the Middle East ahead of the talks and was preparing contingency plans for a prolonged military presence in the region should negotiations fail.
Ongoing geopolitical uncertainty in the Middle East has prompted traders to factor in a higher risk premium for oil, given the potential for supply disruptions.
Stronger dollar adds to pressure before key data
The U.S. dollar strengthened slightly on Tuesday, rising 0.2% against a basket of major currencies. The advance came in relatively thin trading conditions ahead of several important economic releases.
Investors are awaiting a slate of U.S. data this week, including reports on industrial production, trade, and the Personal Consumption Expenditures (PCE) price index — the Federal Reserve’s preferred measure of inflation. The data could influence expectations around future interest rate decisions.
Additionally, minutes from the Federal Reserve’s January policy meeting are set to be released, which may provide further insight into the central bank’s outlook on monetary policy.
