Oil markets surge as Trump loses ground on Iran deal
Refueling a car at a gas station (Photo: Getty Images)
Global oil prices have risen again due to the failure of diplomatic efforts in the Middle East. Talks on a permanent ceasefire between the US and Iran have yielded no results, which has instantly unsettled the energy market, reports Bloomberg.
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In Asian trading, Brent crude showed sharp growth. The barrel is now trading above the $93 mark. This came after the market closed on Friday at its lowest level since mid-April.
The situation escalated after the weekend, as American military personnel were injured during an Iranian attack on an airbase in Kuwait, which could lead to escalation. At the same time, Israel intensified strikes on Hezbollah positions in Lebanon.
Washington and Tehran continue to exchange demands regarding amendments to a peace agreement, but there has still been no significant progress, according to analysts cited in the report. Markets are reacting nervously: the dollar has strengthened, but S&P 500 stocks have slightly declined in value.
Trump and the “situation room”: what went wrong
US President Donald Trump initially showed optimism. On social media, he stated his readiness to make a final decision on a ceasefire, but reality turned out to be more complicated.
According to media reports, Trump left the situation room meeting without any decision. The talks lasted several hours but ended in nothing. The Iranian side is also not rushing to agree to US conditions. Both sides are proposing amendments that the other side may reject.
China’s economic slowdown
News from Beijing is also putting pressure on the situation: industrial activity in China unexpectedly slowed in May. This increases fears that the world’s second-largest economy is suffering from the consequences of the war with Iran and high costs.
Official figures show the following:
- The manufacturing PMI index fell to 50 (from 50.3 in April).
- A reading below 50 indicates contraction in the sector.
- Construction and services activity, on the other hand, rose to 50.1.
BNY macro strategist Wee Khoon Chong notes that China’s economic recovery remains uneven. Traditional businesses are barely staying afloat, while high-tech companies are instead showing growth, creating a mixed picture for global fuel demand.
Situation in the US–Iran confrontation
It has become known that at the last moment, the US president decided to rewrite the agreement with Iran. Trump put forward new demands after reviewing a draft deal that American representatives had reached during contacts with the Iranian side.
Earlier, media reports said that the US and Iran had allegedly come close to a framework agreement that included a 60-day ceasefire, the restoration of shipping through the Strait of Hormuz, and the start of negotiations on Iran’s nuclear program.
