Oil prices keep climbing as markets doubt US-Iran peace
Photo: Oil prices are rising amid the conflict in the Middle East (Getty Images)
Global oil prices rose by 1% as efforts to end the conflict between the US and Iran appear to have reached an impasse, Asharq Al-Awsat reports.
Brent crude futures for June delivery rose by $1.41, or 1.3%, to $109.64 per barrel, after gaining 2.8% in the previous session to their highest closing level since April 7.
US West Texas Intermediate (WTI) crude for June delivery rose by $1.27, or 1.3%, to $97.64 per barrel, after gaining 2.1% in the previous session.
"Talks around ‘peace’ still look largely superficial and lack concrete evidence of de-escalation. Despite the rhetoric, vessel movement through the Strait of Hormuz remains curtailed, and that prolonged disruption is what's keeping oil risk premiums elevated," says Priyanka Sachdeva, senior market analyst at Phillip Nova.
According to her, in the near term, oil markets are less focused on macro demand and more on the diplomatic impasse. Until diplomacy translates into actual oil flows rather than mere statements, oil markets will remain volatile with an upward bias.
Vessel tracking data revealed significant disruptions in the region, as six Iranian oil tankers were forced to turn back due to the US blockade.
However, a liquefied natural gas tanker operated by the Abu Dhabi National Oil Company crossed the Strait of Hormuz and appears to be near India, according to ship tracking data. Before the conflict in the Middle East, between 125 and 140 ships passed through the Strait daily.
New talks attempt?
Iran has presented the US with a new proposal to end the war. The agreement calls for the resumption of traffic through the Strait of Hormuz, including the lifting of the US blockade.
US President Donald Trump, along with his national security team, reportedly reviewed this proposal. He viewed Tehran’s proposal with skepticism but did not reject it outright. However, as CNN reports, the US leader made it clear that he is unlikely to accept it.
