Brent crude oil traded steadily at $118.13 at 9:43 GMT on Thursday morning following news that the US and Iran failed to reach an agreement in talks about Iran's nuclear program.
The commodity has been gaining momentum as the world's largest economies show signs of improvement and support speculation that the global economy is on the mend. However, data from the eurozone on Thursday dampened this sentiment as GDP figures for the fourth quarter of 2012 showed that Germany and France both contracted more than expected.
The poor economic data suggested that the region will continue to struggle well into 2013, and supported speculation that the European Central Bank may have to consider cutting interest rates at their next meeting in March.
The eurozone's poor data was overshadowed by worries about Iran's disputed nuclear program which moved into the spotlight on Thursday. Reuters, reported that the International Atomic Energy Agency was unable to reach an agreement over the investigation of the nation's uranium enrichment program.
The news renewed worries of supply interruption in the future should there be an embargo or in the worst case, a war.
A recent forecast from OPEC showed an increase in oil demand in 2013 based on positive global economic data, leading to a rise in crude prices. Conversely, a report on Wednesday from the US Energy Information Administration cut its demand expectations for 2013 by 90,000 barrels per day, reducing the volume to 840,000 bpd.
The contrasting reports serve as a reminder to markets of the complexity and difficulty of anticipating demand.
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