Crude Oil Price Slips on US-Iran Peace Talk Hopes; Brent Dips Below $92, WTI Under $86

Crude Oil prices declined on Thursday, November 12, as optimism over possible peace negotiations involving the United States, Iran and Russia-Ukraine conflict eased some concerns about supply disruptions. Brent crude slipped below $92 per barrel, while US West Texas Intermediate (WTI) traded below $86.

The decline followed gains of more than 1% in the previous session. Investors weighed the possibility of diplomatic progress against continuing uncertainty in the Middle East, rising OPEC+ production and an increase in US crude inventories. These competing factors are keeping oil markets volatile and making the near-term price outlook difficult to predict.

Key Highlights

• Brent crude futures fell 1.11% to $91.72 per barrel on November 12.
• US WTI crude declined 0.97% to $85.71 per barrel.
• Hopes for peace negotiations involving the US, Iran and Russia-Ukraine conflict weighed on Oil Prices.
• OPEC+ crude production increased in October, while US crude inventories reportedly rose by 9 million barrels.
• Goldman Sachs raised its oil price forecasts, citing potential risks to Middle Eastern supplies.

Crude Oil Price Today, November 12

At around 9:20 am, Brent crude futures were trading at $91.72 per barrel, down 1.11%. US West Texas Intermediate futures declined 0.97% to $85.71 per barrel.

The latest losses came after oil prices recovered during Wednesday’s session. Brent crude gained 1.4%, while WTI advanced 0.6%, rebounding after both benchmarks had fallen to two-month lows in the previous session.

The contrasting movements highlight how quickly oil prices are responding to developments in geopolitics and supply expectations. While diplomatic progress could reduce fears of prolonged disruptions, uncertainty surrounding major oil-producing regions continues to limit the market’s downside.

Peace Talk Hopes Weigh on Oil Market Sentiment

Investor optimism about possible diplomatic progress has been one of the main factors behind the latest decline in crude prices. Markets are watching efforts to secure a ceasefire between Russia and Ukraine, alongside developments involving Iran and the United States.

Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, said expectations of behind-the-scenes efforts to achieve a ceasefire between Russia and Ukraine were weighing on oil prices. He also noted that investors were assessing the possibility that the Iran conflict would not escalate ahead of the upcoming US-China summit.

However, Kikukawa cautioned that uncertainty surrounding the Strait of Hormuz could prevent a significant collapse in oil prices.

Russia-Ukraine Negotiations Show Limited Progress

Negotiators from Russia and Ukraine reached an agreement on a major prisoner exchange during two days of peace talks in Abu Dhabi. However, US mediators indicated that substantial disagreements remained, particularly over territorial issues.

Ukrainian President Volodymyr Zelenskyy expressed hope that concrete progress towards ending the conflict could be achieved within the year.

Any meaningful diplomatic breakthrough could reduce concerns about prolonged geopolitical disruptions and influence expectations for global energy supply. However, the prisoner exchange agreement does not mean that a broader peace settlement has been reached.

US-Iran Tensions Keep Strait of Hormuz in Focus

Developments involving Iran and the United States remain another major source of uncertainty for crude oil markets. Iranian security chief Mohsen Rezaei said Tehran would not allow even a single particle of enriched nuclear material to leave the country and warned of retaliation if the United States launched fresh strikes.

Washington has insisted that nuclear issues should be included in any initial negotiations aimed at ending the eight-month-old conflict. At the same time, US officials have played down the need for additional military action.

The Strait of Hormuz remains particularly important because of its role in global oil transportation. Any disruption to shipping through the narrow waterway could affect supplies from major Middle Eastern producers and push crude prices higher.

OPEC+ Production and US Inventories Add Supply Pressure

Supply-side developments are also influencing the oil market. OPEC+ crude production increased significantly in October, supported by higher output from Saudi Arabia despite continuing shipping disruptions in the Strait of Hormuz.

Higher production can increase the amount of oil available in the global market, potentially limiting price gains when demand does not rise at the same pace.

Meanwhile, US crude inventories reportedly increased by 9 million barrels over the past week, according to market sources cited by Reuters, referring to data from the American Petroleum Institute (API).

A rise in inventories can indicate that available supply is exceeding immediate demand or that refinery consumption and imports are affecting stock levels. However, inventory data needs to be assessed alongside production, imports, exports and consumption trends to understand the broader market balance.

JPMorgan Warns of Potential Global Oil Supply Glut

JPMorgan analysts have warned that the global oil market could move towards a supply surplus as Middle Eastern oil flows recover, production increases in other countries and demand remains relatively weak.

According to a report cited in the supplied market update, the bank estimated that global oil supply exceeded consumption by 1.1 million barrels per day in September. The surplus was estimated to widen to 1.4 million barrels per day in October.

A sustained surplus could put downward pressure on crude prices, particularly if production continues to grow faster than consumption. However, geopolitical disruptions could change the supply outlook and offset some of the expected surplus.

Goldman Sachs Raises Brent and WTI Price Forecasts

Despite the possibility of a global supply surplus, Goldman Sachs has raised its oil price forecasts because of potential supply risks. The investment bank expects Brent crude could reach $105 per barrel by December, compared with its earlier forecast of $90.

Its forecast for US WTI crude has also been increased to $94 per barrel from $81. These projections reflect concerns that geopolitical tensions could disrupt Middle Eastern oil supplies and keep a higher risk premium in crude prices.

Goldman Sachs also outlined a more severe supply disruption scenario. If Gulf oil production remains 3.5 million barrels per day below 2025 levels, Brent crude could peak at $140 per barrel and average close to $130 in 2027.

This is a conditional scenario rather than a confirmed price forecast. Its outcome would depend on the scale and duration of supply disruptions.

Why Oil Price Forecasts Remain Uncertain

The difference between the outlooks from JPMorgan and Goldman Sachs reflects the competing forces currently shaping the oil market.

• Potential supply surplus: Higher production and recovering oil flows could increase global availability and put pressure on prices.
• Geopolitical risks: Escalation in the Middle East could disrupt exports and shipping routes, pushing prices higher.
• Demand conditions: Weak consumption could limit the market’s ability to absorb additional production.
• Diplomatic developments: Progress in peace negotiations could reduce the geopolitical risk premium, while stalled talks could revive supply concerns.

JPMorgan analysts have also highlighted the difficulty of predicting the conflict’s direction. The bank noted that several economic thresholds it had initially expected the US administration to avoid had already been crossed, without a clear exit strategy emerging.

What Lower Crude Oil Prices Mean for India

India is a major importer of crude oil, making international price movements important for its economy. A sustained decline in global oil prices could reduce the country’s import bill and ease pressure on its foreign exchange requirements.

Lower crude prices may also help reduce input costs for oil marketing companies, refiners, airlines, transportation businesses and industries that depend heavily on petroleum products. Depending on the extent and duration of the decline, cheaper oil could also help moderate inflationary pressure.

However, the benefit for India depends on several factors, including the rupee-dollar exchange rate, government taxes, refining costs and international fuel prices. A short-lived decline in Brent crude does not automatically translate into an immediate reduction in domestic petrol and diesel prices.

Conclusion

Crude oil prices slipped on November 12 as hopes for diplomatic progress involving the Middle East and Russia-Ukraine conflict reduced some geopolitical risk concerns. Brent crude fell to $91.72 per barrel, while WTI declined to $85.71.

Nevertheless, rising OPEC+ production and higher US crude inventories are adding to concerns about a potential supply surplus. At the same time, Goldman Sachs’ higher forecasts highlight the possibility of sharp price increases if Middle Eastern supply disruptions intensify.

For now, crude oil markets remain caught between expectations of improved supply and the risk of geopolitical escalation. Investors will continue monitoring peace negotiations, Strait of Hormuz developments, production trends and global demand for clearer direction.