Oil Prices Climb on Iran Deal Uncertainty and Russia-Ukraine Tensions

Oil prices rose in Asian trading on Tuesday, building on strong gains from the previous session as geopolitical risks signaled potential supply disruptions. Brent crude futures increased 0.8% to $65.17 a barrel, while West Texas Intermediate (WTI) gained 0.9% to $62.04 by 01:19 GMT.

The rally follows heightened tensions in several key regions. Uncertainty over the U.S.-Iran nuclear deal added to market jitters. While reports suggested Washington might permit limited uranium enrichment, President Donald Trump firmly denied such allowances, creating further friction with Tehran. A finalized nuclear agreement would likely lift sanctions on Iranian oil exports, boosting global supply. However, continued disagreements may delay any return of Iranian crude to international markets.

In Canada, wildfires in Alberta—an oil-rich province—threaten to curb output, compounding concerns about global supply tightness. Meanwhile, OPEC+ reaffirmed plans to increase production, aligning with market expectations but doing little to ease long-term supply fears.

Adding to the geopolitical strain, a Ukrainian drone strike deep inside Russian territory raised the risk of further disruptions to energy flows. Simultaneously, the U.S. is reportedly considering tougher sanctions on Russia's oil sector, this time aimed at buyers such as China and India. With Russia demanding territorial concessions from Ukraine and peace talks stalling, the prospects for a ceasefire remain slim. President Trump’s renewed calls for peace were largely dismissed by Moscow, increasing the likelihood of deeper sanctions.

The combination of supply-side risks—from stalled Iran talks, Canadian wildfires, and escalating Russia-Ukraine conflict—has created a bullish outlook for oil, keeping prices elevated amid a volatile geopolitical landscape. Traders continue to monitor these developments closely for their impact on global crude supply and energy markets.