Oil Prices Climb as Iran War Optimism Wanes
DUBAI, United Arab Emirates (AP) — Oil prices rose Tuesday, with Brent crude regaining the $100 per barrel mark, as skepticism grew regarding a potential de-escalation of tensions in the Middle East. The price increase reflects ongoing concerns about potential disruptions to global energy supplies amid the Iran war.
International benchmark Brent crude futures with May delivery climbed more than 3% to $103.04 per barrel, while U.S. West Texas Intermediate futures for May traded 4.2% higher at $91.82 per barrel. The gains followed a sharp sell-off Monday, when Brent crude fell approximately 11% to around $99 per barrel after briefly topping $112 on Friday.
The initial dip followed a statement by former U.S. President Donald Trump on his Truth Social account claiming “very good and productive conversations” with Iran regarding a resolution to hostilities. Trump also stated he had instructed the Department of War to postpone military strikes against Iranian power plants and energy infrastructure for five days.
However, Iran refuted Trump’s claims of negotiations, and analysts remain wary.
“Despite the exuberance on Wall Street, oil is well off its lows after Tehran denied conducting any weekend negotiations with Washington,” said José Torres, senior economist at Interactive Brokers. He added that the risk of a prolonged conflict remains a key concern for the market.
Repeated attacks on critical energy infrastructure in the Middle East have fueled fears of disruptions to both production and transportation. Torres noted that even if a deal is reached, lingering nervousness about potential capacity and transportation issues could keep costs elevated compared to the beginning of the year.
Prior to the outbreak of the war, the Strait of Hormuz handled about 20% of global seaborne oil supplies. Iran had virtually halted flows through the critical waterway but indicated Sunday it would permit safe transit for ships not associated with its “enemies.”
The price fluctuations underscore the sensitivity of the oil market to geopolitical events, particularly in the Middle East. The Brent-WTI spread, a key indicator of global energy health, is being closely watched as the situation unfolds.
[CNBC] Oil prices since the start of the year: https://www.cnbc.com/appchart?symbol=%40CL.1&range=YTD&comp=%40LCO.1&type=mountain&embedded=true&$DEVICE$=undefined
