Oil Prices Rise as Iran-US Talks Stall and Shipping Traffic Slows
Oil prices have risen due to concerns over geopolitical risks in the market following a slowdown in shipping traffic through the Strait of Hormuz. On Monday, Brent crude futures increased by 1% to $89.40 a barrel after gaining 72 cents to $89.20 earlier in the day. Meanwhile, U.S. West Texas Intermediate (WTI) crude futures rose by 44 cents to $82.83 a barrel.
The price increase comes after last week's attacks on tankers operated by Abu Dhabi National Oil Company (ADNOC) in the Strait of Hormuz and a refinery belonging to Saudi oil giant Aramco, which had driven up prices by over 5%.
Priyanka Sachdeva, head of market analysis at Phillip Nova in Singapore, noted that hopes for a more sustainable resolution between the U.S. and Iran have faded, leading to a return of geopolitical risk premiums to the market.