Oil Rises, US-Iran Peace Tested in Hormuz
Oil prices rose in trading on Monday (June 29th) as market participants eyed plans for peace talks between the United States and Iran. This increase occurred after weekend tensions around the Strait of Hormuz reminded the market that the ceasefire between the two countries remains very fragile.
West Texas Intermediate (WTI) crude rose more than 2% to close at around US$71 per barrel. Meanwhile, Brent crude rose 1.6% to US$73.15 per barrel. The more active Brent September contract also rose 1.8% to US$73.91 per barrel, while WTI for August added 2.2% to US$70.75 per barrel.
The price increase occurred after the US and Iran reportedly agreed to temporarily halt retaliatory attacks. Ships were also reported to be able to resume free movement through the Strait of Hormuz. US President Donald Trump said the two sides were scheduled to resume peace talks in Doha on Tuesday.
However, Iran stated that it would only send an expert delegation to Doha and would not meet directly with the US team. Tehran also asserted that it would continue with plans to regulate maritime traffic in the Strait of Hormuz, even without Oman's involvement. This stance has kept the market cautious about the direction of the negotiations.
The Strait of Hormuz has been a focus of attention, as approximately one-fifth of the world's crude oil and liquefied natural gas supplies passed through it before the conflict began. Over the weekend, shipping traffic in the region decreased after the Kiku tanker, carrying approximately 2 million barrels of Qatari oil, was attacked. Furthermore, the market is also monitoring fuel supply issues in Russia after President Vladimir Putin acknowledged supply disruptions, including queues at filling stations and a possible ban on diesel exports. (arl)
Source: newsmaker.id
