Hormuz Hopes Tempered: Oil Prices Steady Amid Regional Tensions
Oil prices remained relatively steady on Monday after an initial surge, as optimism over talks to reopen the Strait of Hormuz was tempered by Iran's insistence that the United States meet certain conditions before the waterway can reopen.
Brent crude futures stood at $83.54 a barrel, off 1 cent, by 0643 GMT, while US West Texas Intermediate crude futures fell 15 cents, or 0.2%, to $78.03 a barrel. This followed last week's decline of more than 7% due to hopes that Iran and Oman were close to reaching a deal on the reopening.
Iran said on Sunday that a deal with Oman was in its 'final stages', but emphasized that the Strait would only reopen once Washington met several conditions, including US compensation for attacks on Iran. Iranian Foreign Minister Abbas Araqchi stated that Tehran will not engage in talks as long as Washington breaches an interim deal signed in June.
The situation is further complicated by ongoing regional tensions, with the Iran-aligned Houthis attacking Saudi Aramco's Jazan refinery on Sunday, and the United Arab Emirates' ADNOC reporting 15 vessel attacks transiting the Strait of Hormuz since the conflict began. According to Sugandha Sachdeva, founder of SS WealthStreet, 'any major progress towards restoring unrestricted shipping could exert downward pressure on oil prices'.