Oil Holds Gains as US-Iran Conflict Continues

Crude oil fell toward $82 per barrel on Tuesday, halting a recent rally as hopes grew that peace negotiations between the US and Iran could resume after several days of escalating attacks. Mediators worked on Monday to encourage both sides to agree to a new ceasefire, while reports pointed to a possible 10-day truce. Still, oil prices have rallied sharply this month as US attacks on Iran continued for a tenth consecutive day, while Tehran carried on with retaliatory strikes against neighboring countries. Tensions intensified after President Donald Trump warned that Tehran would be held responsible for the deaths of three US service members. Iran-backed Houthi militants also announced a maritime embargo against Saudi Arabia, raising concerns over energy shipments through the Red Sea.

Crude oil eased toward $82 per barrel on Tuesday, but stayed close to five-week highs as US attacks on Iran entered a tenth consecutive day, while Tehran continued retaliatory strikes against neighboring countries. Tensions intensified after President Donald Trump said Iran had been warned that it would be held responsible for the deaths of three US service members. Iran-backed Houthi militants also announced a maritime embargo against Saudi Arabia, raising concerns over energy shipments through the Red Sea. Meanwhile, Iran said mediators had put forward proposals to help ease tensions with the US after several days of fighting, while reports pointed to a possible 10-day ceasefire. Vessel traffic through the Strait of Hormuz declined sharply this week following Iranian attacks on ships over the weekend, tightening the global supply outlook and continuing to support oil prices.

Crude oil rose to a five-week high of around $83 per barrel on Monday after a volatile session in which prices swung between gains and losses. The rally gathered pace after US President Trump warned that Iran would be held responsible for the deaths of three US service members, while Yemen's Houthi militants announced a maritime embargo targeting Saudi Arabia, heightening concerns over Red Sea energy shipments. Supply risks also remained elevated following recent attacks on oil tankers and energy facilities in Kuwait. Meanwhile, Iran said mediators had presented proposals aimed at easing tensions with the US after several days of hostilities. The conflict has seen the US carry out airstrikes on Iran for nine consecutive nights, while Iran has retaliated with missile attacks on US allies in the Middle East. Earlier in the session, an Iranian Foreign Ministry spokesman said negotiations with the US could resume, provided they align with Tehran's national interests.