Oil prices traded higher during Wednesday's Asian trade, as investors monitored diplomatic engagement between the United States and Iran.
By 3:35 pm AEDT (4:35 am GMT), Brent crude futures were up 24 cents or 0.4% to US$67.66 per barrel, while U.S. West Texas Intermediate (WTI) crude added 19 cents or 0.3% to $62.52 per barrel.
Crude benchmarks had fallen 1.8% and 0.9% in the previous session, respectively.
Iran and the United States agreed on Tuesday on key “guiding principles” during discussions aimed at resolving their long-running nuclear dispute.
However, Iranian Foreign Minister Abbas Araqchi also cautioned that this does not signal an imminent agreement.
Market participants remain wary about whether diplomatic momentum can be maintained.
ANZ analysts commented in a note to clients: "Iran is expected to present a detailed case to the U.S. over the next two weeks, according to an Axios report.
“Negotiations between Russia and Ukraine are also happening in Geneva over the next two days. Ukrainian drone strikes on Russian oil refineries are impacting refined production, leaving more crude oil available for exports.”
Additional pressure came from Russian media reports indicating that production at the Tengiz oil field in Kazakhstan — one of the world’s largest — is ramping up following a suspension in January.
According to Reuters sources, Tengiz is expected to return to full capacity by 23 February.
Investors are also awaiting weekly inventory data from the American Petroleum Institute, due later on Wednesday (Thursday AEDT), followed by figures from the Energy Information Administration, on Thursday (Friday AEDT).
