Crude oil prices experienced downward pressure, concluding the session with a decline of 2.46% at Rs 5,746, as the easing of geopolitical risk premiums followed Tehran’s confirmation of upcoming discussions with Washington this week. The announcement alleviated concerns regarding potential supply disruptions in the short term, although ambiguity remains regarding the extent of the negotiations. Iran seeks to confine discussions to its nuclear program, whereas the US advocates for a more expansive agenda, thereby maintaining a degree of risk premium.

OPEC+ maintains a prudent stance regarding supply and demand dynamics. The group anticipates a gradual improvement in demand starting from March or April and will make a decision on March 1 regarding the resumption of monthly output increases following the pause in the first quarter. Coordination within the alliance remains robust, as Russia and Saudi Arabia reaffirm their commitment to fostering market stability. The IEA has adjusted its global oil demand growth forecast for the year upwards to 930,000 bpd, indicating a marginally reduced surplus.

Simultaneously, US production is projected to decline in 2026 and 2027 following its peak this year, as indicated by the EIA. Inventory data provided a degree of support, as US crude stocks experienced a larger-than-anticipated draw of 3.46 million barrels, while distillate inventories declined significantly, marking the largest decrease since 2021.

From a technical perspective, the market is experiencing long liquidation, as evidenced by a 1.09% decrease in open interest. Immediate support is identified at Rs 5,658, beneath which prices may challenge Rs 5,570. On the upside, resistance is positioned at Rs 5,844, and a breach of this threshold could pave the way toward Rs 5,942.