FX.co ★ Oil Extends Gains

WTI crude oil futures rose to nearly $64 per barrel on Wednesday, building on the previous session's gains. This upward movement was primarily driven by renewed geopolitical tensions following the United States' action of downing an Iranian drone near a US aircraft carrier in the Arabian Sea. The incident created volatility in energy markets, although President Donald Trump highlighted that diplomatic efforts are ongoing, with the White House stating that US-Iran discussions are planned for Friday. The tension was further intensified by Iranian vessels reportedly challenging a US-flagged oil tanker navigating through the Strait of Hormuz, with the US Central Command noting that the IRGC harassed the Stena Imperative. Additional upward pressure on prices originated from API data, which revealed a substantial decline in US crude inventories by 11.1 million barrels last week—the largest reduction since June if verified by official reports. Concurrently, OPEC+ anticipates that oil demand will begin to increase gradually from March or April and is set to make a decision on March 1 regarding whether to resume monthly output hikes following a pause in the first quarter.