Oil Edges Lower as Iran-U.S. Talks to Continue; ULSD Dips

SECAUCUS, NJ (DTN) – Crude and distillate futures dipped Monday amid easing concerns over the security of Middle East oil supplies, after Iranian and U.S. officials signaled a continuation of talks between them that reduced the probability of a military conflict. Gasoline, meanwhile, extended its rising trend of the past seven weeks.

Tensions in the Middle East softened after Iran and the U.S. reported constructive progress and an intent to continue Friday with negotiations over Tehran’s nuclear program. That de-escalated concerns over Iran’s 3.2 million bpd output and the safety of tankers in a region that oversees a fifth of world oil cargoes.

U.S. President Donald Trump’s assertion that India had pledged to discontinue oil purchases from Russia limited some of the downside in oil on the notion that Indian stockpiles could drop. New Delhi has not confirmed the statement by the White House, which is determined to stop as much of oil revenue as possible from flowing to the Kremlin’s coffers in a bid to end the Russian-Ukraine war.

NYMEX WTI crude futures for March slid by $0.27, or 0.4%, to $63.28 bbl, after a 3% drop last week for its first weekly decline in seven weeks.

April ICE Brent fell by $0.28, or 0.4%, to $68.08 bbl. Brent slid 4% last week for its first weekly decline since mid-December.

Downstream, March ULSD slid by $0.0323 or 1.4%, to $2.3810 gallon after two straight weeks of losses.

March RBOB futures bucked Monday’s downward trend, advancing by $0.0113, or 0.6%, to $1.9645 gallon, after seven consecutive weeks of rises.

The U.S. Dollar Index slid by 0.611 points to 96.895, limiting the downside in energy prices.