Oil prices moved higher on Tuesday as traders focused on potential supply disruptions after Iran denied holding negotiations with the United States to end the Gulf conflict, contradicting remarks from U.S. President Donald Trump that an agreement could be reached soon.
Crude futures had fallen more than 10% on Monday after Trump announced a five-day pause in planned strikes on Iranian power facilities, stating that the U.S. had engaged in discussions with unnamed Iranian officials that had produced “major points of agreement”.
By 08:58 GMT, Brent crude futures were up $1.25, or 1.3%, at $101.19 per barrel. U.S. West Texas Intermediate (WTI) gained $2.15, or 2.4%, to trade at $90.28.
The ongoing war has largely halted shipments passing through the Strait of Hormuz, a critical route for roughly one-fifth of the world’s oil and liquefied natural gas supply. The disruption has been described by the International Energy Agency as the most significant oil supply shock on record.
“Today’s moderate bounce is just the market finding its footing in the mud,” said Tim Waterer, chief market analyst at KCM Trade. “Traders are aware that while the missiles are on hold, the Strait of Hormuz is still far from a clear waterway.”
On Tuesday, Iran launched several waves of missiles toward Israel, while officials in Tehran dismissed Trump’s claims about negotiations as ’fake news.’
“The Iran conflict sees tentative de-escalation, but unresolved risks remain around Hormuz,” BCA Research said in a report. “Given continued attack risks and headline volatility, it remains too early to position aggressively for lower oil prices.”
Macquarie warned that if the Strait of Hormuz remains effectively closed through the end of April, Brent crude could surge to $150 per barrel — surpassing the previous record high of $147 set in 2008.
Meanwhile, the latest attacks on regional energy infrastructure have continued. According to Iran’s Fars news agency, a gas company office and a pressure-reduction station were struck in the city of Isfahan, while a projectile also hit a gas pipeline supplying a power plant in Khorramshahr.