Oil Prices Edge Up as Market Awaits US Stock Data and Iran Talks

Global oil prices moved slightly higher on Wednesday (1/7/2026) after a sharp correction the previous day. Brent crude was trading at US$73.20 per barrel, up 0.38%, while West Texas Intermediate (WTI) rose 0.40% to US$69.78 per barrel. This modest increase did little to offset the deep losses sustained throughout June, when Brent tumbled from around US$80 per barrel mid-month, marking a monthly decline of approximately 21%—the steepest since the Covid-19 turmoil in March 2020.

Geopolitical developments in the Middle East continue to influence the market. Reuters reported that a US envoy had arrived in Doha, but high-level negotiations with Iran had not yet commenced. The market is sensitive to any potential deal that could ease sanctions and bring more Iranian crude to the global market.

On the fundamentals side, the market is facing mixed signals. The US Energy Information Administration (EIA) reported that American crude production hit a new record of 13.93 million barrels per day in April. Morgan Stanley has forecast a global oil surplus of around 4.8 million barrels per day by 2027. However, analysts expect the upcoming weekly EIA inventory report to show a drawdown of approximately 4.5 million barrels, which would be the tenth consecutive weekly decline, matching a record streak from January 2018. From a technical perspective, oil prices remain in oversold territory, with Brent having been in this condition for 13 straight days and WTI for 11 days.