Oil prices snap three-day winning streak on US–Iran talk hopes. Where are crude futures headed next?

Oil prices snapped their three-day rising streak, falling nearly 1% in the international markets on Thursday, February 5, after the US and Iran agreed to hold negotiation talks in Oman, easing fears of a possible military confrontation that could disrupt supplies from the key Middle East oil-producing region.

Brent crude futures slipped 1.4% to $68.47 a barrel, while U.S. West Texas Intermediate crude fell 91 cents, also 1.4%, to $64.23. Meanwhile, back home, MCX crude oil prices were down 2% to the ₹5,700 level on Thursday.

Iran-US talks ease oil prices

Iranian Foreign Minister Abbas Araghchi said in a social media post that the talks with the US will take place in Oman on Friday.

However, sharp differences over the framework of US-Iran negotiations have left uncertainty over whether the two sides can meaningfully narrow their gaps amid heightened regional tensions.

Iran is open to discussing its nuclear programme, including uranium enrichment, with Western countries, while the U.S. also wants to include Iran's ballistic missiles, its support for armed proxy groups around the Middle East and its treatment of its own people, a Reuters report said.

According to Bloomberg, the region accounts for nearly a third of global crude supply, and these concerns have brought a risk premium back into oil prices, which have climbed this year after falling in the latter half of 2025 due to signs of a swelling global surplus.

On the supply front, oil output from key producers such as Venezuela and Iran had normalised in recent months, with the latter's production reportedly touching pre-sanctions levels, said Emkay Wealth Management, in a report.

“A large portion of this output had been directed towards Asian markets, particularly China. However, fresh political developments and evolving geopolitical dynamics have reintroduced uncertainty around the continuity and routing of these supplies to global markets,” the asset management firm said in the report.

Crude oil price outlook

Furthermore, Emkay Wealth Management believes that the global crude oil prices may witness a marginal uptick in the near term amid ongoing geopolitical and supply-side uncertainties, but the broader outlook for Brent crude remains largely range-bound, with limited scope for a sustained rally.

“While geopolitical developments could support oil prices in the very short term, the underlying fundamentals suggest that any rally will be limited. With demand growth remaining muted and global inventories expected to rise further, Brent crude is likely to stay range-bound over the medium term. Energy companies and market participants will need to navigate this phase with capital discipline and a focus on operational efficiency rather than relying on price-led growth," said Joseph Thomas, Head of Research, Emkay Wealth Management.

On the technical outlook, Rahul Kalantri, VP Commodities, Mehta Equities, said that crude oil prices are likely to remain volatile in today’s session.

“Crude oil is having support at $62.55-61.0,0 and resistance is at $64.40-65.10 in today’s session,” Kalantri said.

(With inputs from agencies)

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