WTI Crude Near Multi-Week Lows on US-Iran Deal Hopes

Key Moments

Market Overview

West Texas Intermediate (WTI) futures on the NYMEX are down 1.5% and trading just under $85.00 during Asian hours on Tuesday, keeping the contract close to the 10-week low of $84.25 reached on Monday. The move reflects persistent selling pressure as participants react to growing optimism about a possible agreement between the United States and Iran.

The oil market is responding to shifting political signals, with traders reassessing geopolitical risk premia and the likelihood of further military escalation involving Iran.

Softening US Tone Toward Iran Supports Risk Premium Pullback

Analysts at MUFG point to a more moderate stance from Washington as a key driver of improved investor sentiment over the weekend. The shift follows comments by US President Trump, who told CNN it is “highly unlikely” he will need to authorize additional military strikes on Iran if negotiations continue to move forward.

MUFG also notes that Trump underscored the importance of the eventual agreement’s strength, saying “it depends on whether or not they sign a very strong agreement,” which the bank views as an important nuance for maintaining the recent easing in geopolitical risk pricing.

US Political Developments and Expectations for Iran Policy

Energy prices have been under heavy pressure since the outcome of the United States midterm elections, in which Democrats secured victories in both the House and the Senate. That result has reinforced expectations that a deal with Iran may be more likely, as market participants anticipate that Democrats could move to restrict Washington’s funding for further military actions against Iran.

“We are going to end the war. We have some Republicans already who have joined us in ending the war, and the Founding Fathers had the power of the purse as one of the ways of deterring a president who does war without the consent of the American people,” Senate Minority Leader Chuck Schumer (D-N.Y.) said last week, The Hill reported.

WTI Technical Picture: Bearish Bias Intact

On the daily chart, WTI US Oil is quoted at $84.81. The near-term technical outlook remains negative, with the contract trading firmly below the 20-day Exponential Moving Average (EMA) at $93.36. This configuration underscores a market constrained by overhead trend resistance following a pullback from levels above $100.

A new lower low has formed after prices broke beneath the October 6 trough at $86.32, reinforcing the prevailing bearish trend. The Relative Strength Index (RSI) stands at 34, hovering just above oversold territory. This indicates that downward momentum is still dominant, although the rate of decline could start to slow if selling interest diminishes.