Oil steadies amid uncertainty over U.S.-Iran talks

Oil prices held steady on Tuesday, retaining most of the previous session's significant gains. Market sentiment was swayed by ambiguity surrounding ceasefire talks between the United States and Iran and the potential for the Strait of Hormuz to reopen.

“

The market is currently focused on whether there's any concrete progress or setbacks in U.S.-Iran negotiations, the tone and substance of statements from both sides (particularly Iran's threats regarding the Strait of Hormuz), and actual physical tanker movements through the waterway.

U.S. President Donald Trump stated that talks with Iran were continuing, contradicting a report by Tasnim news agency that Tehran had suspended indirect negotiations with Washington. This mixed messaging contributed to market uncertainty.

Brent crude futures saw a slight increase, while U.S. West Texas Intermediate experienced a minor dip. Both benchmarks had surged over 5 percent in the prior session, but their gains moderated following Trump's comments.

“

The status of the U.S.-Iran negotiations at any given point will ultimately determine whether the current risk premium stays embedded in oil prices or starts to unwind.

Market analysts highlighted that oil prices are likely to remain volatile. The focus remains on the progress or setbacks in U.S.-Iran negotiations, Iran's threats concerning the Strait of Hormuz, and actual shipping activity through the vital waterway. The resolution of these talks is expected to determine whether the current risk premium in oil prices persists or diminishes.

“

With headlines continuing to fly out of the Middle East, oil prices are set to remain volatile until clearer evidence of progress towards a peace deal emerges.