Oil Extends Losses

Crude oil climbed above $98 per barrel on Tuesday, recovering some of the previous session's losses following reports of a US attack on Iran's Qeshm Island. The reported strike appears to mark the latest in a series of limited military operations allegedly carried out by Washington while diplomatic negotiations remain ongoing. This follows a sharp decline of more than 6% in the US oil benchmark on Monday, after signs of progress in US-Iran talks eased concerns over further supply disruptions. Iran's Foreign Ministry spokesperson Esmail Baghaei stated that "the ball is in the US court" regarding a potential agreement to end the conflict, while US President Donald Trump claimed in a social media post that Tehran was eager to reach a settlement as soon as possible. These developments come as the US midterm elections get underway, with the Trump administration and Republican Party facing increasing political pressure over rising energy costs associated with the Iran conflict.

Crude oil rose above $97 per barrel on Tuesday but held most of the more than 6% decline in the previous session, as signs of diplomatic progress between the US and Iran eased fears of further supply disruptions. Iranian President Masoud Pezeshkian said his government had received greater authority from the country’s supreme leader to pursue peace negotiations, while US President Donald Trump indicated that progress had been made in the talks. Iranian officials also suggested that a deal remained within reach following three days of Qatar-mediated discussions. These developments come as the US midterm elections get underway, with the Trump administration and Republican Party facing growing political pressure over rising energy costs linked to the Iran conflict. The US oil benchmark had previously climbed to multi-week highs amid concerns that Washington could resume military strikes against Iran following the midterm elections.

Crude oil prices extended their decline on Monday, falling more than 7% to around $96 a barrel, the lowest in three weeks, as hopes for a diplomatic resolution to the US-Iran conflict eased concerns about further supply disruptions. President Trump said Monday that Iran wants to “make a deal and that could happen”. Early in the day, Iran's supreme leader approved the government’s pursuit of talks aimed at ending the months-long conflict that has disrupted Middle East energy supplies, according to Iran’s state-run IRNA agency. This followed reports that President Trump also wanted to give diplomacy more time before considering renewed military action, telling Israeli Prime Minister Benjamin Netanyahu that he preferred negotiations. US Secretary of State Marco Rubio reiterated that Trump favoured a peaceful resolution, while Iranian officials signalled that an agreement remained possible following two days of Qatar-mediated discussions, provided commitments were implemented in practice.