Oil Rises After Trump Rejects Iran Proposal
Oil prices rose on Monday (May 11) after US President Donald Trump described Iran's response to a US peace proposal as "unacceptable," rekindling supply concerns as the Strait of Hormuz remains largely closed.
Brent crude rose 1.8% to US$103.12 per barrel at 13:15 GMT, while WTI rose 1.6% to US$96.97; both contracts had previously touched intraday highs of US$105.99 and US$100.37.
These gains follow a week-long decline of around 6% for both benchmarks on hopes that the 10-week conflict would soon ease and oil transit through Hormuz would resume. However, PVM analysts believe the US and Iran remain far from a deal, with the market now focused on Trump's visit to Beijing on Wednesday and the possibility of China engaging in pressure on Iran towards de-escalation.
On the supply side, Saudi Aramco CEO Amin Nasser said the world has lost about 1 billion barrels of oil in the past two months and the energy market will take time to stabilize even if flows return to normal. Pressure is also evident in physical trade: Saudi crude exports to China are expected to fall again in June as buyers reduce their nominations due to high prices and tighter supplies, according to trade sources.
Meanwhile, shipping data shows flows are continuing but under heightened risk: three crude tankers exited the strait last week and on Sunday with their trackers turned off to avoid Iranian attacks, including a cargo of Iraqi oil bound for Vietnam.
In LNG, a Qatari LNG tanker is also transiting to Pakistan and is expected to arrive May 12, while Japan said a tanker loaded with Azerbaijani crude could arrive as early as Tuesday, the first cargo from Central Asia since the Iran war began. JPMorgan expects oil prices to remain in the low $100s for most of the remainder of this year, with an average of $97 in 2026, stressing that normalization will not be rapid even if Hormuz reopens.
Source: Newsmaker.id
