Noida, Aug 4 (APAC Media): Oil prices rebounded on Tuesday after posting steep losses in the previous session, as mixed signals from the United States and Iran over potential negotiations concerning the Strait of Hormuz renewed concerns about the outlook for global crude supplies.
Brent crude futures rose 2.7% to $86.05 per barrel, while U.S. West Texas Intermediate (WTI) crude futures gained 2.3% to $82.22 per barrel. The recovery followed a nearly 5% decline in both benchmarks on Monday, when optimism over possible U.S.-Iran diplomatic engagement had weighed on prices. 15:45 IST
The latest gains came after contradictory remarks from Washington and Tehran cast doubt over the prospects for negotiations aimed at easing tensions in the region. The Strait of Hormuz, a strategic maritime passage through which around one-fifth of the world’s oil and liquefied natural gas supplies are transported, remains a critical focal point for energy markets.
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U.S. President Donald Trump said on Monday that discussions with Iran were underway and described the current situation as Tehran’s “last chance” to reach an agreement.
“We’re talking about the strait, the opening of the strait, having it open literally by tomorrow,” Trump told reporters in the Oval Office, referring to efforts related to the Strait of Hormuz.
However, Iran rejected claims that direct negotiations with Washington were taking place. Iranian Foreign Ministry spokesperson Esmaeil Baqaei said Tehran was not engaged in talks with the United States and was instead coordinating with Oman on arrangements for vessel traffic through the Strait of Hormuz.
The conflicting statements have added to uncertainty surrounding efforts to de-escalate tensions after months of intermittent confrontation between the two countries. While Trump’s comments suggested renewed diplomatic engagement, Iranian officials maintained that no meetings regarding a ceasefire or broader negotiations had been scheduled.
The uncertainty has tempered hopes for a diplomatic breakthrough that had strengthened after Trump postponed planned U.S. military strikes against Iran over the weekend.
Market participants now remain cautious, with traders closely monitoring developments that could influence crude supply flows from the Middle East.
Analysts at ING said the sharp decline in oil prices during the previous session appeared excessive given the unresolved geopolitical risks.
“The scale of the sell-off seems fairly overdone, given that there’s still considerable uncertainty. We’ve been in this situation multiple times before, only to see things unravel,” analysts said in a research note.
The broker added, “With Iran denying that any talks are underway and Trump issuing warnings if no deal materialises, the backdrop clearly leaves ample room for a renewed escalation.”
Meanwhile, fresh supply data from the United States also remained in focus. Figures released on Monday showed U.S. crude exports fell to 3.66 million barrels per day in July, marking the lowest monthly level in eight months.
The decline was attributed to softer demand for American crude as increased Middle Eastern supplies following June’s temporary ceasefire reduced the need for alternative shipments.
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Disclaimer:Â This article is for informational purposes only. APAC Media is not liable for any investment decisions or losses. Please conduct your own research or consult a financial advisor before investing.
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