Oil prices rose in Asian trading on Tuesday, holding just below seven-month highs hit in the previous session, as investors awaited U.S.-Iran talks later this week, while uncertainty over trade tariffs kept sentiment cautious.

As of 22:22 ET (03:22 GMT), Brent Oil Futures rose 0.8% to $72.04 per barrel, while West Texas Intermediate (WTI) crude futures also gained 0.8% to $66.81 per barrel.

Both contracts touched near 7-month highs in the previous session but closed marginally lower.

Traders await US-Iran talks later this week
Markets remained on edge ahead of a third round of nuclear negotiations between Washington and Tehran scheduled for Thursday in Geneva.

Tensions have remained elevated since last week amid signs of possible escalation. The U.S. has withdrawn some non-essential embassy personnel from Beirut, highlighting fears that diplomacy could fail and trigger conflict.

President Donald Trump said in a social media post on Monday it would be a “very bad day” for Iran if it does not make a deal.

“In the case of a deal, we would see a fairly aggressive erosion of the risk premium currently priced into the market – although reaching a deal is easier said than done,” ING analysts said in a recent note.

Any breakdown in talks could raise concerns about tighter sanctions enforcement or disruptions around the Strait of Hormuz, a vital artery for global crude flows.

Concerns about a possible military confrontation helped push oil prices 6% higher last week.

Trump tariff tensions cloud demand outlook
Oil markets are also navigating broader macro uncertainty after the U.S. Supreme Court struck down an earlier tranche of tariffs imposed under emergency powers.

Trump has since moved to reimpose duties upto 15% under alternative statutes and warned that countries that “play games” with U.S. trade deals could face higher tariffs.

The prospect of renewed trade frictions has clouded the outlook for global growth and fuel demand, tempering oil’s rally even as geopolitical risks keep prices supported.
Source: Investing.com