Oil Prices Drop $2 a Barrel on Supply Forecast

Falling demand, reduced Middle East tensions, and expected supply increases drive price decline.

Published on Feb. 12, 2026

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Oil prices dropped $2 a barrel on Thursday due to falling global demand, retreating fears of renewed Middle East conflict, and expected increases in supply. Brent crude oil futures were down $2, or 2.88%, at $67.40 a barrel, while U.S. West Texas Intermediate crude fell $1.94, or 3%, to $62.69.

Why it matters

The drop in oil prices could provide some relief to consumers and businesses that rely on petroleum products, but also signals potential economic headwinds if global demand continues to weaken. The supply and demand dynamics will be closely watched by policymakers and industry analysts.

The details

The International Energy Agency forecast that global oil demand will rise more slowly than previously expected this year, while projecting a sizeable surplus despite supply outages in January. The price decline came after initial gains driven by concerns over the U.S.-Iran backdrop, but those fears eased after President Trump said negotiations with Iran would continue. A hefty build in U.S. crude inventories also capped early price gains.

  • On Thursday, February 12, 2026, oil prices dropped $2 a barrel.
  • Last week, U.S. crude inventories rose by 8.5 million barrels to 428.8 million barrels.

The players

Brent crude oil futures

A major global benchmark for crude oil prices.

U.S. West Texas Intermediate crude

The main U.S. benchmark for crude oil prices.

International Energy Agency

An intergovernmental organization that provides analysis and policy recommendations on global energy issues.

President Donald Trump

The President of the United States who said negotiations with Iran would continue.

Benjamin Netanyahu

The Prime Minister of Israel who said President Trump appeared to be framing a resolution to the conflict with Iran over nuclear weapons.

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What they’re saying

“The fact that President Trump continues to negotiate with Iran would lead to a reduction of geopolitical risk.”

— Andrew Lipow, President of consultancy Lipow Oil Associates

“This market is anticipating an increase in supply from Venezuela.”

— Andrew Lipow, President of consultancy Lipow Oil Associates

What’s next

The date and venue of the next round of talks between the U.S. and Iran have yet to be announced.

The takeaway

The drop in oil prices reflects a complex interplay of global supply, demand, and geopolitical factors. While consumers may benefit in the short term, the underlying economic conditions that are driving this price decline will be closely monitored for potential longer-term impacts.