Energy Markets React to Continued Strait Disruptions
Global oil prices climbed sharply after the United States and Iran failed to reach agreement on a Washington-backed peace proposal, while disruptions in the Strait of Hormuz continued tightening energy supplies worldwide.
Brent crude futures rose $3.18, or 3.14 percent, to reach $104.47 per barrel after recording gains in the previous trading session. Meanwhile, US West Texas Intermediate crude increased by $3.09, or 3.24 percent, to $98.51 a barrel.
Investors had hoped an end to the 10-week-long conflict between Washington and Tehran would reopen smooth oil transit through the strategic Strait of Hormuz. However, those expectations weakened after US President Donald Trump dismissed Iran’s response to an American peace proposal as “unacceptable.”
Consequently, concerns over supply shortages intensified across global energy markets.
Focus Shifts to Trump’s China Visit
Trump is expected to arrive in Beijing on Wednesday, where he will reportedly discuss Iran and broader regional tensions with Chinese President Xi Jinping.
Additionally, market analysts believe the visit could influence future diplomatic efforts involving Tehran. IG market analyst Tony Sycamore said investor attention had now shifted toward Trump’s China trip and the possibility that Beijing could pressure Iran toward a comprehensive ceasefire.
Meanwhile, Saudi Aramco CEO Amin Nasser warned that the world had lost nearly one billion barrels of oil supply during the past two months. He added that markets would require significant time to stabilise even if shipping routes reopened.
Shipping data from Kpler also showed that two additional oil tankers carrying crude recently passed through the Strait of Hormuz with tracking systems switched off to reduce risks from potential Iranian attacks.
