Oil Rebounds Slightly

Brent crude oil futures traded higher around $103 per barrel on Tuesday, recovering part of the sharp 11% drop seen in the previous session, though gains were more limited as markets remained volatile. Oil moved higher in choppy trading as investors weighed escalating geopolitical tensions. US allies including Saudi Arabia and the United Arab Emirates have taken a firmer stance against Iran following attacks on their territories, with reports suggesting Riyadh could consider military action if its infrastructure is targeted. There are also signs Gulf states may move closer to joining the conflict, which would mark a major escalation. Meanwhile Iran signaled it does not intend to restore normal conditions in the Strait of Hormuz and ruled out negotiations with Washington, although diplomatic efforts continue with regional ministers holding talks in Riyadh.

Brent crude futures climbed above $102 per barrel on Tuesday, recovering some losses from the previous session as Iran pushed back against President Donald Trump’s claims, denying any talks to end the conflict. Tehran dismissed Trump’s announcement as an attempt to influence financial markets and launched new attacks on US targets, while Israel continued strikes against Iran. On Monday, Brent futures had plunged over 10% after Trump postponed planned strikes on Iranian energy infrastructure for five days and said productive talks were ongoing. The delay was seen as an effort to stabilize oil prices, with Trump noting they would “drop like a rock” once a deal is reached. The outcome of any talks and the potential reopening of the Strait of Hormuz remain highly uncertain, keeping markets cautious. The conflict has effectively shut the critical global chokepoint through which roughly 20% of the world’s oil flows, forcing Middle Eastern producers to sharply reduce output.

Brent crude futures held around $100 per barrel on Tuesday after plunging more than 10% in the previous session, as President Donald Trump postponed planned strikes on Iran’s energy infrastructure for five days and said productive talks with the country are ongoing. His decision to delay the strike was seen as an effort to stabilize oil prices, with Trump saying they would “drop like a rock” once a deal is reached. However, Tehran denied that any negotiations were taking place, while Israel continued its attacks on Iran. Markets are now pricing in the potential reopening of the Strait of Hormuz, as the conflict effectively shut the critical global chokepoint through which roughly 20% of the world’s oil flows, forcing Middle Eastern producers to significantly curb output. Iran remains in firm control of the narrow waterway, with only a limited number of ships able to pass depending on alliances.