RoydadNaft –  Brent oil prices edged slightly lower in Asian trading on Tuesday. Traders are weighing the potential for supply disruptions, a concern that has intensified following Iran’s naval exercises near the Strait of Hormuz—just ahead of the most significant round of Iran-U.S. nuclear talks starting today.

According to Roydad Naft, Brent futures contracts were down 0.47% (32 cents) to $68.33 as of 04:30 GMT. This comes after a 1.33% increase the previous day (Monday).

U.S. WTI reached $63.51, reflecting a 62-cent or 0.99% gain. However, this increase captures the full extent of Monday’s movements, as the U.S. market was closed for Presidents’ Day, so no formal WTI settlement occurred yesterday.

Many major Asian markets—including China, Hong Kong, Taiwan, South Korea, and Singapore—are closed today due to the Lunar New Year holiday.

U.S. President Donald Trump stated on Monday that he would be indirectly involved in the Geneva negotiations and expressed belief that Iran is willing to reach an agreement.

Sogandha Sachdeva, market analyst and founder of SS WealthStreet in New Delhi, commented:

“Right now, market sentiment is more dependent than anything else on the tone and progress of the Iran-U.S. negotiations, which is helping maintain the geopolitical risk premium in prices.”

According to her, oil prices are likely to remain volatile in the coming period and will be driven more by diplomatic signals and political news than by traditional supply-and-demand fundamentals.

Iran began its military exercises in the Strait of Hormuz yesterday. This strategic waterway is the primary route for oil exports from Arab Gulf countries, especially to Asian markets.

Meanwhile, Citigroup has forecasted:

If Russian supply restrictions persist and Brent stays in the $65–70 range, OPEC+ will likely tap into its spare capacity and increase production.

Three sources familiar with OPEC+ also reported that the group is preparing to resume output hikes starting in April, driven by approaching summer demand and the current price support from U.S.-Iran tensions.

In its base-case scenario, Citi predicts:

“An agreement with Iran is likely by this summer, along with a resolution to the Ukraine-Russia issue. In that case, Brent prices could fall to the $60–62 range.”