US-Iran Tensions Send Oil Prices Soaring

Oil prices rose sharply on Tuesday after conflicting statements between the United States and Iran fueled fears that a new peace plan is not in sight.

The price of oil reached $90 per barrel, but dipped slightly to $87 as of Tuesday morning, according to West Texas Intermediate futures. Brent crude also increased, rising to $87.74.

The conflicting statements between Washington and Tehran added to the fears, with President Donald Trump demanding that Iran pay reparations, dimming hopes for peace. Iranian Foreign Minister Abbas Araghchi said Sunday that the two sides were engaging, but not in person.

Analysts at ING wrote in a Tuesday note that 'the oil market remains very headline-driven, which leaves prices whipsawing.' The latest bout of optimism is quickly fading, they added. Current rhetoric suggests any potential deal is still some way off, meaning risks remain skewed to the upside for oil prices.