Brent crude is trading around the $98 a barrel mark, having added close to 10% in the last two trading sessions. West Texas Intermediate or the US crude variant traded around the $90 a barrel mark.
In his post on Truth Social, Trump said that the US will hold off on fresh attacks on Iran but keep blocking ships linked to Iran till “discussions are concluded, one way or the other.”
Oil prices tested highs of $120 per barrel in the initial days of the war, but plunged on multiple ceasefire announcements and extensions. However, analysts continue to maintain that while the rhetoric keeps markets on the edge, supply constraints continue to persist.
“Headlines are coming at 100 miles an hour, but the barrels are still stuck in neutral,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth Group. “The back-and-forth around a ceasefire extension, potential blockade, and Iran’s role is keeping markets on edge, but the reality is flows remain constrained.”
Brent tested the $100 a barrel mark again on Tuesday after US Vice President JD Vance scrapped his upcoming trip to Pakistan for participating in the second round of talks with Iran. The rise in oil prices put pressure on US equities as well during regular trading on Tuesday. While futures are moderately higher on the extension news, oil prices remain steady.
“What matters for the oil market — and increasingly for the global economy — is the state of the Strait of Hormuz,” said Vandana Hari, founder of analysis firm Vanda Insights. “With no conceivable way to reopen it without a peace deal, we are stuck in a high oil price and inflationary environment.”
Also Read: Crude basket surges to $116, but govt says fuel prices and supplies remain stable(With Inputs From Agencies)
