Brent Oil Surges 2% After US Strikes in Iran Cast Doubt on Peace Talks

The price of Brent crude climbed more than 2% on Tuesday after the US military executed strikes in southern Iran. This move has soured the atmosphere surrounding stalled peace negotiations and added tension to the critical oil shipping lanes near the Strait of Hormuz.

As of early trading, Brent futures were trading around $98.50 per barrel, up approximately $2.36 from Monday's close. This rebound came after a sharp 7% drop in the previous session, reflecting the volatility roiling energy markets.

West Texas Intermediate (WTI) crude hovered near $91.95 per barrel, slightly recovering from its steep decline since Friday. The market had been cautiously optimistic about a potential peace agreement, but those hopes took a hit with the new US actions and Israeli strikes on Hezbollah targets.

The conflict has effectively shut down nearly 20% of the world's oil and liquefied natural gas shipments flowing through the Strait of Hormuz since hostilities began. The blockade of this passage adds a premium to oil prices due to supply risks.

Meanwhile, high-level talks between Iranian officials and Qatar's prime minister are ongoing in Doha, aiming to draft a memorandum of understanding to halt the conflict. Both Washington and Tehran have indicated progress, outlining a plan that might allow for mine clearance and open navigation through the strait within a month.

Recent shipping data revealed an uptick in vessel movements, including liquefied natural gas tankers reaching Pakistan, China, and India, along with a supertanker carrying Iraqi crude to China after months of immobilization.

Unofficial channels report that Iran may agree to stop collecting transit fees and remove naval mines, which has sparked speculation of easing tensions and reopening the vital route for global energy transport.

Despite these talks, US Secretary of State Marco Rubio cautioned that finalizing a deal may take several days, casting doubts on short-term resolution prospects. Meanwhile, President Donald Trump reiterated calls for Iran to surrender its enriched uranium stockpile.

The ongoing unpredictability reflects the fragile nature of Middle East diplomacy and keeps energy markets on edge. Brent's recent movements underscore the heightened sensitivity to geopolitical developments in this oil-rich region.