US-Iran Deadlock Drives Oil Prices Higher Amid Inflation Fears
Oil prices have surged by around 10% over the past week due to fading hopes for a deal on the Strait of Hormuz. This has led to fresh inflation fears and increased bets on at least one US interest rate hike this year.
The situation between the US and Iran remains deadlocked, with both sides trying to 'weaponise' oil prices without resorting to further military action. The latest development came from President Donald Trump, who said he would seek conflict compensation from Iran as part of any peace negotiations.
This move was in response to Tehran's demand for US war reparations as a precondition to resolving the crisis. The US president had earlier indicated that he was 'low-keying' his approach to the conflict, suggesting he was open to letting economic pressure mount instead of further military strikes.
Analysts say this back-and-forth is putting a quick agreement further out of reach, with oil prices continuing to rise. Stephen Innes, global strategist at Quintex Intel, described the situation as 'quite the game of chicken'.