Oil prices held steady on Tuesday as traders stayed alert to rising geopolitical risks and upcoming economic data. The market is balancing supply concerns with demand signals from major economies. Any shift on either side could move prices quickly.
Brent crude traded near $69.21 a barrel. US West Texas Intermediate hovered around $64.41. Both contracts showed small gains after a strong rise in the previous session.
Why oil prices are steady today despite recent jump
Oil prices had surged more than 1% earlier after reports showed the US taking a tougher stance on Iran. That rally has now paused. Traders are waiting to see if tensions worsen or ease.
Weekend talks between the US and Iran showed some progress. This helped calm fears briefly. But uncertainty remains high. Iran has resisted pressure to halt nuclear enrichment. This keeps risk premiums in oil markets alive.
For now, traders are holding back from aggressive bets.
US Iran tensions raise oil supply concerns
Fresh concerns emerged after a warning from US authorities. The US Maritime Administration advised US flagged vessels to avoid Iranian waters. Ships were told to stay closer to Oman while passing through the Strait of Hormuz and the Gulf of Oman.
The warning cited risks of vessels being boarded by Iranian forces. This raised alarms in energy markets. The Strait of Hormuz is a critical route for global oil shipments.
Even with ongoing diplomatic talks, tensions remain unresolved. Any disruption in this region could quickly impact oil supply.
Economic data from US and China in focus
Markets are also watching major economic reports this week. In the US, nonfarm payroll data is due on Wednesday. Inflation numbers will follow on Friday. These reports will shape expectations around interest rates.
Interest rate outlooks matter for oil demand. Lower rates can support economic activity and fuel consumption. Traders are also mindful of upcoming leadership changes at the Federal Reserve.
In China, consumer inflation data is due on Wednesday. The release comes just before the Lunar New Year holiday. Travel and fuel demand usually rise during this period.
Together, geopolitical risks and economic data are keeping oil prices range bound for now. The next clear move will depend on how these factors unfold.
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