Oil prices are trading higher, a day after renewed fighting near the Strait of Hormuz raised new questions about the ceasefire between the US and Iran.
Brent crude futures were up $1.67, or 1.7%, at $101.73 a barrel this evening, having been up as much as 3%. US West Texas Intermediate (WTI) futures were up $1.04, or 1.1%, at $95.85.
Over the week, both contracts were still set for a decline of about 7%.
US and Iranian forces clashed in the Gulf, and the UAE came under renewed attack as Washington awaited a response from Tehran to its proposal to end the conflict, which began with joint US-Israeli airstrikes across Iran on February 28.
US President Donald Trump later told reporters the ceasefire was still in effect and sought to play down the exchange.
“How quickly can supply be returned from Gulf states, what will the state of inventories be as we approach peak gasoline season, and what sanctions would look like post-settlement are all worthy of thought. But none can be addressed until there is a long-term solution to hostilities,” said PVM Oil Associates analyst John Evans.
“The US administration continues to oversell the prospects of a thaw, and an optimism-biased market buys into it,” Vanda Insights’ said Vandana Hari, founder of oil market analysis firm Vanda Insights.
“Curiously, each time, the rebound is gradual and incomplete, making the head fakes at least somewhat effective.”
Meanwhile, the US Commodity Futures Trading Commission is investigating oil price trades totalling $7 billion placed shortly ahead of key Iran war-related announcements by Trump, Reuters reported yesterday.
Most involved short positions, or bets on prices falling, placed on the Intercontinental Exchange (ICE) and Chicago Mercantile Exchange (CME) and were placed shortly before Trump statements announcing attack delays, the ceasefire or other changes to Iran policy that led to a decline in oil markets.
