Oil and gas prices surge after US-Iran talks collapse
Photo: a tanker carrying oil (Getty Images)
Oil and natural gas prices surged after the US Navy seized an Iranian vessel, following Tehran’s attacks on European ships and its reestablishment of control over the Strait of Hormuz, according to Bloomberg.
As a result, the price of Brent crude jumped 7.9%, recouping most of Friday’s decline following the announcement that the Strait of Hormuz had reopened. Meanwhile, the price of European gas rose 11% amid the latest developments in the conflict in Iran.
"The market’s still carrying a risk premium into the deadline, but just not fully committing to it," says Haris Khurshid, chief investment officer at Karobaar Capital LP in Chicago.
"If things just continue as they are, you probably see a gradual push higher to around $105–$115, but with a lot of back and forth on headlines," he adds
Recent developments between Iran and US
Donald Trump stated on Sunday evening that the US Navy fired upon and seized an Iranian vessel in the Gulf of Oman after it failed to heed warnings to stop while exiting the Strait of Hormuz, marking the first serious clash in the week-long standoff.
The incident occurred a few hours after disputes over potential peace talks in Islamabad, where Trump said he saw a chance for a deal, while the Iranians stated there was no clear prospect.
Tehran’s refusal to engage in talks is attributed to the US's hardline stance toward Iran, specifically regarding nuclear deterrence against the Islamic Republic.
Trump has already stated that Iran even agreed to an indefinite moratorium on its own nuclear development and the export of the country’s enriched uranium to the US, without demanding the return of its frozen assets, which are located in several countries.
