WTI slumps to near $61.00, traders await fresh round of nuclear talks between US and Iran

• WTI price edges lower to around $61.10 in Thursday’s Asian session. 

• US-Iran will hold nuclear talks, weighing on the WTI price. 

• Oil inventories rose by 1.328 million barrels in the week ended May 16, according to the EIA. 

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $61.10 during the Asian trading hours on Thursday. The WTI price edges lower on the report that a fresh round of nuclear talks between the United States and Iran would take place later this week.

On Tuesday, the US obtained new intelligence suggesting that Israel is making preparations to strike Iranian nuclear facilities, even as US President Donald Trump has been pursuing a diplomatic deal with Tehran. It isn’t clear that Israeli leaders have made a final decision to carry out the strikes, CNN said, citing unnamed officials.  

An attack by Israel would hinder any progress in those negotiations and contribute to tension in the Middle East, which provides about one-third of the world's petroleum. Next round of Iran-US talks will take place on Friday in Rome. Any signs of progress of nuclear talks might cap the upside for the WTI price.

About the data, the US Energy Information Administration (EIA) weekly report showed crude oil stockpiles in the US for the week ending May 16 climbed by 1.328 million barrels, compared to a rise of 3.454 million barrels in the previous week. The market consensus estimated that stocks would drop by 1.85 million barrels.  

Oil traders will keep an eye on the US economic data released later on Thursday, including the advanced S&P Purchasing Managers Index (PMI), the Chicago Fed National Activity Index, the usual Initial Jobless Claims and Existing Home Sales reports. The downbeat readings could exert some selling pressure on the Greenback and lift the USD-denominated commodity price in the near term.