Oil prices were stable on Monday after the US. and Iran pledged to continue indirect talks, easing oil supply fears, but India stepping away from Russian purchases gave prices a floor and global stock markets rallied.
Brent crude oil futures were up 6 cents, or 0.1%, at $68.11 a barrel by 1304 GMT, while U.S. West Texas Intermediate crude rose 5 cents, or 0.1%, to $63.60.
Last week Brent and WTI fell more than 3% and 2% respectively, their first decline in seven weeks, as Iran tensions eased amid a broader market selloff led by equities, which often move in tandem with oil prices.
Iran and the U.S. pledged to continue talks after what both sides described as positive discussions. That eased concerns that a failure to reach a deal might nudge the Middle East closer to war, as the U.S. has positioned more military forces in the area.
About a fifth of the oil consumed globally passes through the Strait of Hormuz between Oman and Iran.
However, Iran’s foreign minister said the country will strike U.S. bases in the Middle East if attacked by U.S. forces.
“The Iranian risk premium cannot be fully defused as long as U.S. warships are located where they are,” said SEB analyst Bjarne Schieldrop.
Investors are also grappling with Western efforts to curb Russia’s income from oil exports that support its war in Ukraine. The European Commission has proposed a sweeping ban on any services that support Russia’s seaborne crude oil exports.
Refiners in India, once the biggest buyer of Russia’s seaborne crude, are avoiding purchases for delivery in April, sources said. If India fully stopped Russian purchases “this would be a sustained bullish development,” said Sparta oil market analysts.
Meanwhile in Kazakhstan, the giant Chevron-led Tengiz oil field has recovered to around 60% of peak production and aims to reach full output by February 23, sources said.