Brent Crude Rebounds

Brent Crude Oil increased 5.17% to 83.041 USD/Bbl

Brent crude oil rose more than 1% to nearly $80 per barrel on Wednesday after US President Donald Trump warned that bombing of Iran could resume if Tehran failed to “behave,” raising fresh uncertainty over a potential ceasefire deal. Trump said the memorandum of understanding with Iran was not final, adding that military action remained possible. The US-Iran memorandum, which extends a fragile ceasefire by 60 days, could allow talks toward a lasting truce and help rebuild depleted inventories. Still, industry officials said a full recovery in Iranian production and refining capacity could take weeks, months or even years, limiting the speed of any supply rebound. Nevertheless, oil prices remained near three-month lows, however, as the International Energy Agency warned of a looming supply surplus. In its first outlook for 2027, the IEA said global oil supply could rise by 8 million barrels a day while demand grows by only 2 million bpd, creating significant oversupply.

Brent crude oil was below $79 per barrel on Wednesday, hovering at its lowest level since early March amid expectations of a US-Iran deal that could rapidly add supply back to the global market. The potential interim agreement, expected to be signed Friday, could allow Tehran to resume oil exports immediately and ease restrictions on shipping through the Strait of Hormuz, prompting tanker operators to reposition vessels toward the region. The release of more than 100 oil-laden ships currently stuck in the Gulf could further boost supply. The International Energy Agency warned that the conflict may cause a larger-than-expected demand hit and contribute to a renewed global oil surplus. Brent prices have fallen nearly 40% from their conflict peak as geopolitical risk fades. The decline is also easing inflation concerns, with lower fuel prices helping consumers. However, US crude inventories continued to fall, with an industry estimate showing an 8.3 million-barrel draw last week.