Brent Oil Rises Above $97, US-Iran Risks and Falling US Stockpiles Maintain Price Premium
Brent oil prices rose more than 1% to above $97 per barrel on Wednesday (June 3), extending their gains for the third consecutive session. The market responded to a combination of geopolitical headlines and fundamental signals, after US President Donald Trump said Iran had agreed not to pursue nuclear weapons and suggested he could meet with Iranian Supreme Leader Ayatollah Mojtaba Khamenei if developments were positive.
However, tensions between Washington and Tehran remain high as negotiations on an interim peace deal continue. This uncertainty maintains the risk premium on oil, especially as the market still believes the direction of talks could change rapidly amid the unstable dynamics of the conflict.
The situation is further complicated by Israel's expanding operations in Lebanon. Trump said he had encouraged Israeli Prime Minister Benjamin Netanyahu to de-escalate the conflict in a recent call, but regional escalation remains a source of volatility for energy markets.
Overnight, US and Iranian forces engaged in one of the most serious confrontations since the ceasefire began, with Kuwait and Bahrain also affected. Security developments around the Gulf are once again in focus, potentially disrupting perceptions of supply risks and energy logistics channels.
From a fundamental perspective, recent data shows that US crude oil inventories fell by 6.8 million barrels last week, marking the sixth consecutive week of declines. This tightening in stocks provides additional support for prices, reinforcing an upward bias as the market also holds a premium for geopolitical risk.
Going forward, the market will be monitoring two main channels: whether US-Iran talks result in more concrete de-escalation steps, and whether the downward trend in US stockpiles continues. The combination of the two will determine whether Brent is able to hold above US$97 or becomes again sensitive to changes in regional headlines.
Source: Newsmaker.id
