US-Iran Conflict Sends Oil Prices into Brief Steady State

Oil prices steadied on Wednesday after rising for three consecutive days due to the US-Iran conflict. President Donald Trump stated that the renewed attacks would be brief, while also reaffirming his claim that the US controls the Strait of Hormuz.

West Texas Intermediate (WTI) traded near $91 a barrel, up from its previous 9% surge over the past three sessions. Brent settled below $96 on Wednesday, while Trump mentioned that the US bombing campaign could be short-lived, although he also stated 'we're prepared to do another one.'

Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc., noted that the latest escalation should maintain market support, but added that both the US and Iran are seeking off-ramps in the conflict. This could lead to deflated prices if more peace talks ensue.

However, neither the US nor Iran has shown a willingness to negotiate since the collapse of an interim peace accord in June. Crude prices have risen by almost 60% this year due to the Middle East conflict and the Russia-Ukraine war.