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Oil Markets on edge as US and Iran prepare for another round of talks in Geneva

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Web Desk: Iran and the United States are set to resume high-level negotiations in Geneva on Thursday, seeking to defuse tensions over Tehran’s nuclear program and prevent the prospect of fresh US military action amid an expanded American force presence in the Middle East.

The latest round follows renewed diplomatic engagement earlier this month aimed at breaking a decades-long impasse. Washington and its allies, including Israel, accuse Tehran of pursuing capabilities that could lead to nuclear weapons. Iran maintains that its nuclear activities are strictly peaceful.

US Special Envoy Steve Witkoff joined the American delegation, while Iran’s Foreign Minister Abbas Araqchi represented Tehran in the indirect talks. Oman’s Foreign Minister Badr Albusaidi mediated the discussions, continuing Muscat’s longstanding role as an intermediary between the two adversaries.

The meeting comes after earlier consultations in Geneva last week and against the backdrop of heightened military deployments by the United States in the region. Analysts describe the buildup as the most significant American presence in the Middle East in years, raising concerns about the risk of a broader conflict.

Earlier this week, US President Donald Trump told Congress he preferred a diplomatic resolution but reiterated that he would not permit Iran to obtain a nuclear weapon. Vice President JD Vance reinforced that message in a televised interview, describing the prevention of a nuclear-armed Iran as a core US objective.

At the same time, Trump warned in February that Tehran faced severe consequences if it failed to reach an agreement within weeks.

The diplomatic push unfolds amid heightened volatility in energy markets. Oil prices edged higher on Thursday as traders assessed whether negotiations could reduce the risk of supply disruptions in the Gulf. However, gains remained limited following reports of rising US crude inventories.

Meanwhile, two sources familiar with contingency planning said Saudi Arabia is reviewing measures to adjust oil production and exports should military action disrupt regional flows.

Last year, the United States joined Israel in striking Iranian nuclear facilities, prompting Tehran to vow a strong response if targeted again.

Araqchi said earlier this week that Iran sought a fair and swift agreement but would not abandon what it considers its legitimate right to peaceful nuclear technology. In a statement posted on X, he said diplomacy could succeed if given priority.

According to Iranian officials, Tehran has proposed new concessions in exchange for sanctions relief and formal recognition of its right to enrich uranium. However, significant gaps remain, particularly over how and when U.S. sanctions would be eased.

A senior Iranian official said disagreements persist on both the scope of sanctions removal and the sequencing of commitments, underscoring the fragility of the process.

The negotiations also take place at a sensitive moment inside Iran. Supreme Leader Ayatollah Ali Khamenei faces mounting economic strain as tighter sanctions weigh heavily on the country’s finances. In addition, authorities have confronted renewed protests following unrest earlier this year.

The head of the International Atomic Energy Agency, Rafael Grossi, is also expected in Geneva to consult separately with both sides, continuing his agency’s involvement in monitoring Iran’s nuclear activities.

While both Washington and Tehran publicly endorse diplomacy, deep mistrust and unresolved technical disputes continue to cloud prospects for a breakthrough. Nevertheless, officials say the Geneva talks represent a critical opportunity to steer the confrontation away from military escalation and toward a negotiated settlement.

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