Oil prices continue to be supported by a significant risk premium driven by ongoing geopolitical tensions across the globe. However, market attention is now shifting toward upcoming diplomatic talks in Geneva involving the United States and Iran, as well as Russia and Ukraine. Analysts at ING suggest that any signs of de-escalation or a shift toward diplomacy during these meetings could trigger a notable price correction. If the geopolitical premium fades, the market is expected to refocus on underlying bearish fundamentals related to supply and demand. Consequently, Brent and WTI contracts remain highly sensitive to the outcomes of these high-stakes negotiations in Switzerland. A successful diplomatic breakthrough could lead to a swift removal of the current price floor supported by political uncertainty.
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