Oil Prices Rise as US-Iran Deal Hopes Fizzle, Strait of Hormuz Tensions Escalate

Oil prices rose towards $90 per barrel on Wednesday as fading hopes for a US-Iran peace deal heightened concerns about disruptions to energy supplies and shipping through the Strait of Hormuz. The Brent crude price increased by 72 cents, or 0.8%, to $89.63 per barrel, while U.S. West Texas Intermediate crude gained 71 cents, or 0.9%, to $83.91 per barrel.

The gains followed a sharp rise earlier in the week as investors became less confident that Washington and Tehran would reach an agreement easing tensions and allowing more normal oil shipments through the region. The Strait of Hormuz has become a major focus for energy markets, with shipping traffic through the waterway falling sharply from pre-conflict levels.

Iran has stated that the strait will remain closed unless the United States changes its position and meets Tehran's conditions. The uncertainty has raised concerns among traders about how long disruptions to crude and other energy shipments could last.