Brent crude eased this week after renewed U.S.–Iran diplomatic engagement removed a key geopolitical risk premium. Prices swung between roughly $67.5 and $70/bbl, with a mid-week drop on confirmation of talks and a modest rebound as diplomacy continued. For traders and investors, the episode highlights how headline diplomacy can quickly erase risk premia and why short-term positioning should prioritize event-driven volatility and clear risk management.

Brent crude swung from a late-January geopolitical-driven high near $70.66 to a mid-week drop into the mid-$60s after U.S.–Iran diplomatic signals reduced the conflict risk premium. The week highlighted how headline-driven volatility and a $3–$4 per-barrel geopolitical premium can rapidly reshape short-term price direction and trading strategies.

Brent crude climbed on short-lived geopolitical supply fears but retreated as inventory builds and robust non-OPEC output kept markets oversupplied. Recent agency forecasts diverge—IEA upgraded demand but flagged excess supply, the EIA forecasts a lower 2026 average, while some forecasters see temporary support from OPEC+ cuts. Futures volume spikes and falling open interest point to active repositioning by traders.

Brent crude rallied early in the week on heightened Iran unrest and renewed Russian strikes, then lost gains after diplomatic de-escalation. Structural oversupply and weak demand keep longer-term price support limited despite short-term geopolitical swings.

Brent crude saw mixed moves last week as renewed Venezuelan exports and a large U.S. inventory build weighed on gains, while geopolitical tensions around Iran and Black Sea supply risks preserved a price premium. Diverging forecasts from the EIA, Goldman Sachs and Citi highlight short-term volatility and a tug-of-war between oversupply and risk-driven upside.

U.S. authorization for Venezuelan crude shipments and a weaker 2026 EIA price outlook pressured Brent this week. New Venezuelan barrels into U.S. markets, combined with an oversupplied global crude balance and a lower EIA forecast for Brent, left prices soft even as energy equities climbed.