Oil Rises Ahead of US-Iran Talks, Market Wary of Hormuz Risk
Oil prices rose in Asian trading, as market participants weighed the chances of a US-Iran nuclear deal ahead of Thursday's talks. Despite hopes for diplomacy, the massive deployment of American troops in the Middle East kept the market on alert for the risk of escalation that could disrupt supply.
Brent rose back above US$71 per barrel after falling 1% in the previous session, while WTI held around US$66. Tensions escalated after Secretary of State Marco Rubio and the CIA Director briefed senior officials on Iran, fueling market speculation about potential military action. President Donald Trump expressed his preference for diplomacy but warned that failure to reach a deal would be a "very bad" situation for Tehran.
In his speech, Trump reiterated that the US will not allow Iran to acquire a nuclear weapon, while Iran has repeatedly stated its nuclear program is for peaceful purposes and denies pursuing one. The market believes these statements from both sides are keeping tensions high, making oil prices highly sensitive to any news developments ahead of the talks.
One of the biggest risks is the potential disruption in the Strait of Hormuz, a waterway that handles about a quarter of the world's seaborne oil trade and is also crucial for LNG shipments. While the administration remains in power, oil prices tend to be influenced by geopolitical factors, although some analysts believe that seasonal disruptions are relatively unlikely due to their significant impact on trade flows and Iranian revenues.
The next round of nuclear talks is scheduled for Thursday in Geneva, with Trump's special envoy Steve Witkoff and Trump's son-in-law Jared Kushner set to meet again with Iranian Foreign Minister Abbas Araghchi. At 11:38 a.m. Singapore time, Brent crude futures for April rose about 0.8% to US$71.32, while WTI crude futures for April rose 0.8% to US$66.13 per barrel. (asd)
Source: Newsmaker.id
