Brent crude surged as much as 7.9% in early trading to $97.5 a barrel, after a fall of over 9% last Friday. West Texas Intermediate, or the US Crude variant (WTI), also surged as much as 8% to reclaim the $90 a barrel mark.
Oil prices had tanked on Friday after Iran announced that the Strait of Hormuz will be open for commercial traffic throughout the duration of the ceasefire with the US, only to announce its closure 24 hours later, citing a US blockade of ships that left Iranian ports that violated the ceasefire agreement.
In fresh developments, US President Donald Trump also said that the US Navy has fired upon and seized a ship in the Gulf of Oman after it failed to heed to warnings to stop while leaving the crucial waterway. While Trump continues to maintain that there are prospects for a deal, Iran said there is no such possibility till the US blockade continues.
The ceasefire put in place earlier this month, ends on Tuesday.
“The hopes that the war was nearing a conclusion have evaporated over the weekend.” said John Kilduff, a partner at Again Capital. “The Strait of Hormuz never opened, and the amount of disrupted supply continues to grow by the day.”
While oil prices have rebound, the US Markets, which ended at record highs on Friday, have seen a drop in the futures market with trading having resumed on Sunday evening local time.
(With Inputs From Agencies)
