Oil climbs as Middle East tensions escalate, Iran talks stall
Oil prices climbed more than 1% on Wednesday, continuing gains from the previous trading session, as renewed hostilities in the Middle East intensified and negotiations between Tehran and Washington stalled.
Brent crude futures increased by $1.56, or 1.6%, reaching $97.56 per barrel at 0640 GMT, while U.S. West Texas Intermediate (WTI) crude rose by $1.61, or 1.7%, to $95.37, News.Az reports, citing Reuters.
Both benchmark contracts had closed at a one-week high in the previous trading session.
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Iran fired ballistic missiles toward neighbouring countries Kuwait and Bahrain but did not hit their intended targets, according to the U.S. military, which also stated that American forces carried out retaliatory strikes on Iran’s Qeshm Island.
“The stalling in the U.S.-Iran negotiations and IEA warnings of critical global low stock levels are adding upward layers in risk premium in benchmark prices,” said Emril Jamil, a senior oil analyst at LSEG.
The head of the International Energy Agency’s oil industry and markets division said on Tuesday that global oil inventories could reach critically low levels ahead of the peak summer demand season if stock draws continue at the current pace.
Traders were watching diplomatic developments closely after Iranian media reported on Tuesday that Tehran is reviewing a proposed agreement with Washington aimed at halting the conflict.
According to the reports, Iran has not communicated with the United States for several days, although former President Donald Trump said negotiations had been ongoing continuously.
Both benchmark contracts had closed at a one-week high in the previous trading session.
Iran fired ballistic missiles toward neighbouring countries Kuwait and Bahrain but did not hit their intended targets, according to the U.S. military, which also stated that American forces carried out retaliatory strikes on Iran’s Qeshm Island.
“The stalling in the U.S.-Iran negotiations and IEA warnings of critical global low stock levels are adding upward layers in risk premium in benchmark prices,” said Emril Jamil, a senior oil analyst at LSEG.
The head of the International Energy Agency’s oil industry and markets division said on Tuesday that global oil inventories could reach critically low levels ahead of the peak summer demand season if stock draws continue at the current pace.
Traders were watching diplomatic developments closely after Iranian media reported on Tuesday that Tehran is reviewing a proposed agreement with Washington aimed at halting the conflict.
According to the reports, Iran has not communicated with the United States for several days, although former President Donald Trump said negotiations had been ongoing continuously.
By Nijat Babayev
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