WTI remains range-bound below $72.00 as markets assess ongoing geopolitical developments

• WTI is trading within a narrow range as investors remain cautious amid conflicting signals from the US and Iran.
• Ongoing exchanges of fire between the US and Iran continue to fuel geopolitical concerns, providing underlying support for crude oil prices.
• However, market anxiety has eased after US President Donald Trump stated that Iran is willing to negotiate a deal, limiting further gains in WTI.

West Texas Intermediate (WTI), the US benchmark for crude oil, remains stable during Friday’s Asian trading session after recovering from the previous day’s decline. Mixed signals from Washington and Tehran have encouraged traders to stay on the sidelines, with prices hovering near $71.75 and showing little change on the day as markets await fresh developments in the Middle East.

Geopolitical concerns returned to the forefront this week after the US launched a new round of military strikes against Iran in response to attacks on commercial vessels transiting the Strait of Hormuz. Tehran retaliated by targeting regional US allies and striking American military facilities in Bahrain and Kuwait. Adding to the tensions, US President Donald Trump announced on Wednesday that the ceasefire was effectively over, helping drive crude prices higher earlier in the week.

However, sentiment improved on Thursday after Trump stated that Iran had reached out seeking negotiations to prevent further escalation. A White House official also reaffirmed Washington’s commitment to the existing memorandum of understanding with Tehran. These developments, combined with OPEC+’s decision to raise production targets once again, may limit upside momentum in oil prices and prompt traders to remain cautious about initiating new bullish positions.

Meanwhile, the latest report from the US Energy Information Administration (EIA) showed an unexpected increase in crude inventories for the week ending July 3, marking the first stockpile build in eleven weeks. Commercial crude inventories climbed by 2.998 million barrels, well above market expectations. The larger-than-forecast increase could continue to weigh on prices, although WTI remains on track to post a modest weekly gain and potentially end a four-week losing streak.