After his State of the Union address, U.S. President Donald Trump was accused of telling big lies. Not by the Democrats, many of which had their fingers in their ears screaming “I am not listening”, but by Iran. President Trump played out the potential justifications for military action against Iran, accusing the country of restarting its nuclear program, developing intercontinental ballistic missiles capable of reaching the United States “soon,” sponsoring terrorism through proxies, and being responsible for roadside bombings that have killed American service members and civilians. He emphasized that Iran, as the “world’s biggest sponsor of terrorism,” would not be allowed to possess nuclear weapons, framing these issues as direct threats to U.S. and regional security.
Iran’s Foreign Ministry swiftly rejected these claims with spokesman Esmaeil Baqaei stating in a post on X that the U.S. allegations regarding Iran’s nuclear program, ballistic missiles, and the number of casualties from January’s domestic unrest were “simply the repetition of ‘big lies.’” Baqaei further accused the U.S. and Israel of employing “Nazi propaganda” tactics in a disinformation campaign against Iran.
It seems that Iran protests too much by just calling out Trump as a liar but failing to provide any evidence to the contrary. This comes as oil traders must adjust to the risks of escalation and of possible de-escalation. In his speech President Donald Trump said he would prefer a diplomatic resolution to the crisis with Iran but made clear he would never allow Tehran to obtain a nuclear weapon.
Which put us back into this guessing game. President Trump is using the persuasion of the strongest military on the face of the earth to encourage the Iranians to make a deal. Trump knows that any deal will have to come with a basis of trust but verify at the same time. President Trump also sent a signal to the Iranian people saying last month, “Iranian Patriots, Keep Protesting-take over your institutions. Help Is On The Way”.
The tension overshadowed inventories from the showing inventories surged by +11.4 million barrels — way above the roughly +1.85 million barrel build that analysts had penciled in. This reverses the prior week’s modest -0.609 million barrel draw and marks one of the larger weekly builds we’ve seen recently. Gasoline inventories drew down by about -1.53 million to -1.54 million barrels (solid product demand signal). Distillate inventories (diesel/heating oil) fell by around -2.77 million to -2.8 million barrels (another bullish lean on fuels).
The massive crude build overshadowed the consecutive draws in gasoline and distillates, pressuring oil prices in early overnight trading. WTI dipped below $66 in reaction, as the data reinforced oversupply concerns amid steady production and imports. Cushing (WTI delivery hub) stocks reportedly climbed +1.79 million barrels, adding to the bearish tone there.
That said, context matters: Geopolitical risk (U.S.-Iran tensions and upcoming talks) continues to provide a floor under prices, keeping them near seven-month highs despite the inventory noise. The product draws suggest underlying demand remains resilient, especially as refiners run hard and seasonal factors play in. We’ll get the official later today (Wednesday), which often diverges from API — sometimes significantly. If EIA shows a similar crude build, it could extend the pressure short-term, but watch for refinery utilization, imports, and any SPR updates to round out the picture.
continues to feel the weight of a classic shoulder-season unwind as we head into late February and thoughts of spring are springing. Overnight and early trading saw March NYMEX futures (NGH26) hovering around $2.82–$2.85/MMBtu, down fractionally in thin pre-open action, with the contract dipping to fresh multi-month lows in recent sessions. The market is clearly pricing in a rapid shift after January’s brutal cold snaps and record withdrawals pushed Henry Hub spot averages to $7.72/MMBtu for the month (with intraday spikes hitting absurd levels like $30+ during the peak freeze-offs), we’ve seen a dramatic reversal with Spring. Fox Weather is showing warmer weather outlooks across much of the U.S. and has crushed heating demand expectations, while production remains robust and LNG exports stay strong but not enough to offset the bearish sentiment.
Storage draws are slowing, and the deficit from earlier winter is expected to flip toward surplus sooner than anticipated if mild patterns hold. Futures settled lower Tuesday, with March drifting amid trimmed heating demand in overnight models. Physical cash prices softened in many regions as seasonal mild weather takes hold, though Northeast remnants from prior storms kept some localized support. Technically, we’re testing major support near the $2.80–$2.82 area—failure there opens the door to retest October lows around $2.60. Bulls would need a surprise cold shot or production hiccup to reclaim an edge.
