Oil steadied after a drop, with signs of strain in the US economy amid the brewing trade war and talks with Iran on its nuclear program in focus.

Brent was below $66 a barrel after a 1.5% decline on Monday, with West Texas Intermediate near $62. A widely-referenced gauge of US manufacturing activity weakened significantly, adding to signs of the drag from President Donald Trump’s tariffs. A slew of data due this week will shed further light on conditions.

Geopolitics remain at the fore, with ongoing talks between Washington and Tehran that have the potential over time to see curbs on Iranian oil loosened. Discussions over the Islamic Republic’s atomic activity are showing signs of progress, with Iran also pitching its sanctioned economy as an investment opportunity to the US.

Brent crude is on track for the largest monthly decline since August 2022, with prices battered by Trump’s rapid escalation of tariffs between the US and its biggest trading partners, as well as by OPEC+ plans to revive production. While many countries are entering into trade negotiations with Washington, Beijing remains on the sidelines.

Widely watched market metrics, however, have pointed to a gradually tightening market in April. The spread between Brent’s two nearest contracts has been widening in backwardation ahead of expiry, with the June contract trading at a premium over the July one. The measure is around the strongest in nearly three months.

Elsewhere, most of Spain and all of Portugal was hit by the worst blackout in Europe in years, with several oil refineries in Spain forced to halt. Power is gradually being restored.

Prices:

  • Brent for June settlement fell 0.2% to $65.72 a barrel at 8:13 a.m. in Singapore.

  • WTI for June delivery declined 0.2% to $61.92 a barrel.

. Read more on Markets by NDTV Profit.While many countries are entering into trade negotiations with Washington, Beijing remains on the sidelines.  Read MoreMarkets, Business, Bloomberg 

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