WTI crude oil futures edged up to $70.6 per barrel on Monday but remained near yearly lows, as investors focused on developments surrounding Ukraine peace talks and the potential resumption of crude exports from northern Iraq.
Oil edges up slightly
European Union leaders are set to hold an emergency summit on March 6 to discuss additional support for Ukraine, with President Zelenskiy signaling a willingness to step down if it helps bring an end to the conflict. Meanwhile, US President Trump has initiated direct talks with Russia, excluding both Ukraine and the EU, with more discussions expected later this week. The prospect of an end to the war could impact oil markets, although an immediate surge in Russian supply is unlikely due to ongoing OPEC+ production limits, which have capped output. Even so, a potential de-escalation could still push oil prices lower, as it might ease some of the geopolitical risk premium that has been supporting prices.
Focus shiftsto Iraq
In addition, the focus has shifted to Iraq, where the resumption of operations in the Iraq-Turkey pipeline could lead to an additional 185,000 barrels per day in supply once fully operational. This potential increase in exports from Iraq, one of the world's largest oil producers, is closely watched by the market, especially as it could ease some supply tightness in the global oil market. Despite these developments, the outlook for oil remains uncertain, with a mix of geopolitical factors, including the evolving situation in Ukraine and potential changes in global production levels, influencing the near-term price trajectory. Traders will be closely monitoring these developments, particularly as the March 6 EU summit and further diplomatic talks unfold, to gauge the impact on supply-demand balances and oil price direction in the coming months.
