Oil prices were steady on Monday as signs of a breakdown in U.S. talks with Iran over its nuclear program offset pressure from a Moody's downgrade of the U.S. sovereign credit rating.

Brent crude futures were down 20 cents at $65.21 a barrel by 1:36 p.m. ET (1736 GMT), while U.S. West Texas Intermediate crude was up 3 cents, or 0.1%, at $62.52 a barrel.

Both contracts rose more than 1% last week.

Nuclear talks between Iran and the U.S. will yield nothing if Washington insists Tehran halt its uranium enrichment activities, Iranian state media quoted Deputy Foreign Minister Majid Takht-Ravanchi as saying on Monday.

The remarks dashed hopes for a deal between the two sides that would pave the way for the easing of U.S. sanctions and allow Iran to increase its oil exports by 300,000 to 400,000 barrels per day, said StoneX analyst Alex Hodes.

"That potential increase seems highly unlikely right now," he said.

However, oil prices have been under pressure from a Moody's downgrade of the U.S. sovereign credit rating, which raised questions about the health of the world's largest oil-consuming nation, and data showing slowing growth in industrial production and retail sales in China, the largest oil importer.

"The weaker-than-expected Chinese data did not help crude, although I would describe the deterioration as modest," said UBS analyst Giovanni Staunovo.

Adding to the pressure on the oil market were comments from U.S. Treasury Secretary Scott Bessent, who said President Donald Trump would impose tariffs at the level he threatened last month on trading partners that do not negotiate in "good faith."

Oil prices are likely to remain volatile for the foreseeable future as investors look for updates on tariffs, U.S.-Iran negotiations and talks to end the war in Ukraine, said John Kilduff, a partner at Again Capital in New York.

Russian President Vladimir Putin, after calling Trump on Monday, said Moscow was ready to work with Ukraine on a memorandum of understanding on a future peace deal and that efforts to end the war were on track.

An end to the war would allow for higher Russian oil exports and would likely push crude prices sharply lower, Kilduff said. (Newsmake23)

Source: Reuters