US-Iran Tensions Ease Slightly as Oil Prices Inch Up

Oil prices have made a modest recovery after taking a hit from ongoing tensions between the US and Iran. On Tuesday, Brent crude rose by $0.62 to $84.39 per barrel, while US WTI increased by $0.61 to $80.95, both climbing about 0.7% after sharp falls in the previous session.

The recovery is attributed to a small improvement in market sentiment, but analysts warn that prices are still capped due to concerns over the Strait of Hormuz, a narrow waterway that handles around 20% of all global oil shipments. The US has called on Iran to guarantee safe passage through the area, but Iran has disagreed, leading to ongoing tensions.

Saudi tankers have also started taking longer routes around Africa, which is adding to costs and delays. This is keeping oil prices from fully bouncing back just yet, according to experts.