Oil prices regain upward momentum; US and Iran disagree on ending the war path

Oil prices rise, the US and Iran issue conflicting statements on ending the war efforts. This conflict has led to the paralysis of the Strait of Hormuz and sparked global energy crisis concerns.

WTI breaks above $91 per barrel, after closing down about 2% on Wednesday, while Brent remains above $102 per barrel. Although the White House insists that peace negotiations are ongoing, Tehran has rejected the US proposal and put forward its own conditions, including sovereignty rights over the Strait of Hormuz.

WTI is heading toward its largest monthly gain since mid-2020, as this conflict sweeps through the energy-rich Middle East and impacts the global economy. Blockage of the Strait of Hormuz means a daily loss of millions of barrels of oil.

On Wednesday, the White House simultaneously suggested the possibility of a diplomatic solution and issued threats of further military strikes. White House Press Secretary Karine Jean-Pierre stated that Trump “will not bluff,” and if Iran does not accept defeat, he is prepared to make Iran pay a heavy price.

“Iran controls the strait; he (Trump) needs the strait open,” said Aaron Stein, director of the Foreign Policy Research Institute.

Stein also said, “He can do it through negotiation or force. He’s trying both. So it’s the same old story, prices will fluctuate back and forth, and traders will keep guessing the direction of the situation.”

Prices:

At 6:01 AM Singapore time, May WTI rose 1.1% to $91.27 per barrel;

May Brent closed down 2.2% on Wednesday, settling at $102.22 per barrel.