Oil Prices Pare Gains on US-Iran Diplomatic Efforts Continuation
Oil prices pared gains on Tuesday after Qatar's Foreign Ministry spokesperson, Majed Al Ansari, said efforts to secure a diplomatic resolution to the US-Iran conflict were continuing. This statement came as both Brent and WTI crude futures had risen earlier in the session by over 2% due to uncertainty over prospects for a US-Iran agreement.
Giovanni Staunovo, an analyst at UBS, attributed the oil price gains to uncertainty over prospects for a US-Iran agreement. However, prices pared gains after Qatar's comments, with Brent futures rising 17 cents to $83.94 a barrel and WTI crude down 30 cents at $80.04 a barrel.
The Strait of Hormuz remains a central sticking point in talks between the US and Iran. Iran wants control over inbound shipping through the strait and visibility over outbound traffic, with the ability to intervene if necessary. This plan is being discussed with Oman to reopen the strategic waterway.