Huge draw …

Expectations I had seen centred on:

• Headline crude -3.4 mn barrels
• Distillates -1.3 mn bbls
• Gasoline -2.1 mn

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Crude markets navigated a choppy session before settling broadly flat on Tuesday, with two late Wall Street Journal reports pulling benchmarks back toward their highs into the close.

The more consequential of the two pieces reported that mediators see little meaningful progress in US-Iran nuclear talks, with Tehran’s negotiating position described as largely unchanged from earlier rounds that failed to produce a deal. WSJ sources also indicated that the United States and Israel had been actively preparing fresh strikes on Iran, with some suggesting military action could still come as early as next week. A separate WSJ report added that Washington had seized an Iran-linked vessel in the Indian Ocean overnight, marking at least the third tanker seizure tied to the crackdown on Iran’s shadow fleet.

Earlier in the session, a brief burst of upside followed reports of an explosion on Qeshm Island, though this was subsequently attributed to the disposal of unexploded munitions rather than any new military exchange, and the move faded accordingly.

As background:

The session’s most significant headline had actually landed after Monday’s settlement, when Trump confirmed he had called off a planned strike on Iran scheduled for Tuesday, citing requests from Saudi Arabia, the UAE and Qatar. He nonetheless kept the pressure on, warning Iran could face another hit within two to three days, and that a decision would be known “very soon.” Vice President Vance reinforced the binary framing, stating Iran faces a straightforward choice between reaching an agreement or resuming hostilities, while noting that meaningful progress had been made.

WTI and Brent settled little changed, with ranges remaining contained by recent standards.