Oil: Nuclear talks pressure prices – ING

FXStreet Insights Team FXStreet

ING analysts Warren Patterson and Ewa Manthey note that constructive US–Iran nuclear talks are weighing on Oil prices, even as uncertainty keeps a risk premium in Brent. They highlight increased speculative net longs in ICE Brent and a bullish volatility skew. Upcoming reports from the EIA, OPEC and IEA are expected to add further noise for Crude Oil and Brent benchmarks.

US–Iran talks and positioning shape oil

"Oil prices came under renewed pressure in early morning trading in Asia after nuclear talks between the US and Iran were seen as constructive."

"Clearly, there’s still plenty of uncertainty over how things will evolve."

"This suggests the market will likely continue to price in a risk premium."

"Uncertainty around oil has also led option market participants to become increasingly positioned for a potential move higher in prices, with a bullish volatility skew in Brent."

"Speculators remain nervous about being short in the oil market, given the ongoing uncertainty."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

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