US-Iran Deal Uncertainty Trims Oil Price Losses

Oil prices trimmed their losses as expectations for a US-Iran deal grew stronger. Last Tuesday, crude oil sold off as the anticipation for a deal increased, but the losses were erased when the anticipated timeline passed without an announcement.

The lack of US attacks on Iran has kept hopes alive and is likely to keep a lid on oil prices barring another escalation. Qatari mediators said that the language for a possible US-Iran agreement had been drafted, and US Treasury Secretary Bessent confirmed that an Iran deal could have come as soon as Wednesday.

The deal would have included the reopening of the Strait of Hormuz, but there have been mixed messages regarding the deal and the strait. Despite this, the absence of US attacks has provided a glimmer of hope for oil markets.