WTI. Price Analysis. Forecast. Limited Decline in Oil Prices Ahead of U.S.-Iran Negotiations

[Ben Graham]

West Texas Intermediate (WTI) crude oil prices have continued to decline for the second consecutive day, hovering around the round level of $66.00 per barrel. Pressure on WTI has intensified following a sharp increase in U.S. oil inventories, exacerbating concerns about a supply surplus in anticipation of the Energy Information Administration (EIA) report scheduled for later in the day. The American Petroleum Institute (API) reported a weekly increase in U.S. crude oil inventories of 11.4 million barrels for the week ending February 20, compared to a decrease of 0.609 million barrels the week prior.

However, the potential for price declines may be restricted as investors weigh supply risks ahead of the third round of U.S.-Iran nuclear negotiations. In his address to Congress about the state of the nation, President Donald Trump reaffirmed his commitment to diplomacy but accused Iran of reviving its nuclear program and developing long-range missiles capable of striking the U.S. The Iranian Deputy Foreign Minister, in turn, noted Tehran's willingness to do "everything possible" to reach an agreement with Washington.

The market is closely monitoring the situation in the Strait of Hormuz—a critical juncture through which approximately 20% of global oil flows pass—where escalation could disrupt supplies. Furthermore, traders are assessing the impact on oil demand from new U.S. trade initiatives, as Trump's 10% tariff has already gone into effect, with plans for it to rise to 15%.

From a technical perspective, prices have shown resilience below 66.50, with oscillators on the daily chart remaining positive, confirming the predominantly bullish presence in the market. The 200-day SMA is gradually gaining a positive slope, indicating a shift in the global trend toward growth.

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