Oil Prices Stabilize After Plunge, Market Digests Further Signals of US-Iran Talks
Oil prices stabilized after a sharp decline, amid signs that the United States and Iran are working to arrange a second round of peace talks in the coming days. Brent held below US$95 per barrel after falling 4.6% yesterday, while WTI traded around US$91.
The push for diplomacy emerged ahead of the end of the ceasefire next week, with plans for a follow-up meeting reportedly being held before that deadline. President Donald Trump stated that talks could resume within the next two days. The location is still being considered.
However, supply dynamics remain under pressure due to the US blockade of the Strait of Hormuz aimed at suppressing Iranian oil exports, while traffic disruptions in the key waterway connecting the Persian Gulf to global markets continue to hamper energy flows. Tehran is reportedly considering pausing shipments through the waterway to avoid testing US crude oil.
Supply shocks from the conflict have hit global oil markets, pushing up the physical prices of crude oil and products like gasoline. These conditions are pressuring consumers and potentially eroding demand, with the International Energy Agency predicting a decline in consumption this year.
Several market participants believe that the room for short-term price increases is likely to be restrained as the market digests the shift in narrative toward diplomacy, although the recovery in physical supply is not expected to be rapid. The risk of a logistical bottleneck around Hormuz is seen as maintaining a price floor, while ANZ estimates that the recovery in supply from the Middle East could be gradual, with 2–3 million barrels per day potentially returning in the first four weeks if the risk of escalation subsides.
From the US side, the American Petroleum Institute reported that national crude oil inventories rose by 6.1 million barrels last week, which, if confirmed by official data on Wednesday, would be the eighth consecutive increase. The market is also closely monitoring Washington's policy regarding the end of a waiver on partial purchases of Iranian oil this weekend, while the most decisive signals are the continued increase in shipping traffic and the direction of US-Iran negotiations in the coming days. (asd)*
Source: Newsmaker.id
