Oil prices edged higher on Thursday as escalating tensions between the United States and Iran fueled investor concerns, pushing Brent crude near $69.74 and U.S. West Texas Intermediate to $65 per barrel. The gains reflect geopolitical uncertainty coupled with expectations of steady global demand.
Brent crude futures rose 34 cents, or 0.49%, while WTI increased 37 cents, or 0.57%, after both benchmarks settled higher on Wednesday. Investor worries about Middle East instability overshadowed a significant rise in U.S. crude inventories, keeping markets cautious yet optimistic.
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U.S. President Donald Trump and Israeli Prime Minister Benjamin Netanyahu reportedly reached no “definitive” agreement on Iran during recent discussions, though Washington insists negotiations will continue. Meanwhile, U.S. and Iranian diplomats conducted indirect talks in Oman, with the next round of meetings still unannounced.
Market analysts suggest that a sustained break above $65–$66 in WTI would require further escalation, whereas any de-escalation could prompt profit-taking toward $60–$61. Traders are closely watching diplomatic developments for cues on potential price movements.
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Additionally, strong U.S. economic data has reinforced oil demand expectations. January job growth accelerated unexpectedly, while unemployment fell to 4.3%, signaling economic resilience that supports sustained energy consumption across multiple sectors.
However, a large U.S. crude stock build capped the upside, as inventories rose by 8.5 million barrels to 428.8 million, far exceeding expectations. Despite this, tighter Russian sanctions and generally lower-than-expected global inventory growth are likely to keep prices biased upward in the near term.