Crude oil futures slipped in after-hours trading on Tuesday and are on track for their biggest quarterly decline since 2020 as markets weighed the prospect of a US-Iran summit in Qatar after conflicting signals from Washington and Tehran over the status of the indirect peace talks.
Front-month West Texas Intermediate crude futures fell 1.3% to $69.81 per barrel, while Brent futures dipped by 0.2% to $72.99/bbl.
Saxo Bank strategists said crude prices traded within a relatively tight range near recent lows while remaining on track for their biggest quarterly decline since the pandemic.
Though President Trump said that the US and Iran would hold fresh talks in Doha on Tuesday, Iran's deputy foreign minister said Tehran hadn't decided on the timing of the discussions.
Trump told reporters at the White House on Monday that the meeting in Doha "is going to be perhaps important, perhaps not," adding that they were "going to find out."
However, Iranian officials denied that talks between the two sides were scheduled for this week, noting that an Iranian technical delegation's visit to Qatar this week was unrelated to US officials' visit to the country.
Iranian Foreign Ministry spokesman Esmaril Baghaei said Iran has not yet entered the phase of final agreement negotiations and will not do so until the US begins implementing five key provisions of the MoU.
Iran's Deputy Foreign Minister Kazem Gharibabadi also said "no technical talks" with the US have been scheduled in Doha this week. Gharibabadi said holding technical meetings of the working groups has not been scheduled for this week.
Soojin Kim, a research analyst at MUFG, said uncertainty remains over the next phase of negotiations, with the US expecting direct talks, while Iran has indicated it will send only a technical delegation.
On the supply front, crude flows via the Strait of Hormuz are picking up, with vessel-tracking data showing more crossings, though they remain below pre-war levels.
Warren Patterson, head of commodities strategy at ING, said that oil flows averaged about 7 million barrels per day over the past week, compared to pre-war flows of 20 million b/d.
Patterson added that they did not expect to see Strait of Hormuz oil flows return to 20 million b/d in order for Persian Gulf oil supply to fully recover.
Saxo Bank analysts also said flows through the Strait of Hormuz continue to accelerate, prompting Morgan Stanley to warn that the release of previously stranded barrels could create a near-term supply glut and put additional downward pressure on prices.
Iran has reiterated its determination to control maritime traffic through the Strait, with Ebrahim Azizi, head of Parliament's National Security and Foreign Policy Committee, reportedly saying that the strategic waterway is an "inseparable" part of Iran's national sovereignty.