Oil Prices Rebound Amid Uncertainty Over US-Iran Diplomacy
Oil prices rebounded by over 1% on Tuesday to reach $85 per barrel as concerns over Middle Eastern energy supplies persisted amid uncertainty over diplomatic efforts to end the US-Iran war.
The sharp sell-off in oil prices on Monday had triggered a decline of 7% in Brent crude futures, but the lack of clarity over whether formal talks are actually underway has kept traders cautious and left the market vulnerable to renewed volatility.
US President Donald Trump's claim that negotiations were underway to end the war and settle a dispute over control of the strategically important Strait of Hormuz was met with skepticism by Iran, which denied any negotiations.
The conflicting statements have added to uncertainty in oil markets, with traders now watching closely for signs of whether diplomatic engagement can actually take place. Analysts warn that prices could quickly rebound if military attacks resume or tankers operating near the Strait of Hormuz come under fire again.