Oil prices edged lower on Wednesday after a surprisingly large increase in U.S. crude inventories outweighed concerns that Middle East military tensions could disrupt global supply.
Benchmark Brent crude fell slightly to about $70.65 per barrel, while West Texas Intermediate (WTI) dropped to around $65.37 per barrel. Market pressure came mainly from U.S. stockpile data showing that crude inventories jumped by about 16 million barrels last week, far exceeding analysts’ expectations of a 1.5-million-barrel rise.
The inventory surge was linked to higher imports and lower refinery activity, according to the U.S. Energy Information Administration. Analysts also noted that an unusually large adjustment figure in the report created uncertainty about actual supply levels.
Despite the bearish inventory signal, geopolitical worries kept oil prices from falling sharply. Traders remain focused on tensions involving the Iran and possible U.S. military actions in the region. A prolonged conflict could disrupt exports from Iran, a major producer within the Organization of the Petroleum Exporting Countries, and other Middle Eastern suppliers.
U.S. political signals also influenced sentiment. Donald Trump mentioned the possibility of action against Iran during his State of the Union address, reinforcing market concerns about security risks around global energy routes.
Meanwhile, diplomatic talks are continuing, with U.S. and Iranian representatives scheduled to meet in Geneva. Officials from both sides have suggested that a negotiated agreement may still be possible.
Looking ahead, the OPEC+ alliance is expected to discuss a potential production increase for April, while some producers, including Saudi Arabia, are preparing contingency plans to raise output if regional conflict threatens oil supply chains. Tariff uncertainty in global trade policy has also added pressure to investor confidence.
