The United States Oil Fund LP (USO) experienced a sharp decline of 5.04% during the night session. The exchange-traded fund, which tracks the price of crude oil, moved significantly lower as market sentiment shifted.
The drop followed reports indicating a potential de-escalation in geopolitical tensions. Former U.S. President Trump expressed hope to "reach an agreement" with Iran, while the Iranian Foreign Minister stated confidence in reaching a nuclear deal with the United States. This development reduces the geopolitical risk premium typically baked into oil prices.
Simultaneously, the "OPEC+" alliance, including major producers like Saudi Arabia and Russia, announced it would maintain its pause on production increases for March, keeping output unchanged. However, analysts cited in reports note that the fundamental backdrop of a global crude supply surplus remains unchanged, with demand growth unable to keep pace with supply growth, applying downward pressure on prices.
