Oil Prices Jump Nearly 3% as Russia-Ukraine Talks End and Iran Tensions Persist
Oil prices climbed close to 3% on Wednesday after peace talks between Russia and Ukraine in Geneva ended abruptly. Ongoing concerns about rising tensions between the United States and Iran also supported crude prices.
Brent crude futures rose $1.96, or 2.9%, to $69.38 per barrel at 14:40 GMT. U.S. West Texas Intermediate (WTI) crude gained $1.75, or 2.8%, to $64.08 per barrel. Both benchmarks had fallen to two-week lows in the previous session.
Russia-Ukraine Peace Talks Show No Progress
The U.S.-mediated negotiations in Switzerland lasted only two hours. U.S. President Donald Trump recently indicated that Ukraine needed to take further steps to ensure progress. Ukrainian President Volodymyr Zelenskiy described the discussions as “difficult.”
Market analysts noted that neither the Ukraine talks nor diplomatic discussions involving Iran showed meaningful progress. As a result, traders viewed Tuesday’s price dip as a buying opportunity.
Iran Tensions Renew Supply Concerns
Oil prices had initially declined on Tuesday after signs that U.S.–Iran tensions might be easing. Iran’s foreign minister said both countries had reached an understanding on the main “guiding principles” of nuclear negotiations.
However, fresh developments revived concerns. Iran’s semi-official Fars news agency reported that Iran and Russia will conduct joint naval drills in the Sea of Oman and the northern Indian Ocean. The exercises follow recent Revolutionary Guards military drills in the Strait of Hormuz.
Iranian state media also reported that parts of the Strait of Hormuz were temporarily closed for security reasons during military exercises. The strait is a crucial global oil transit route, and any disruption raises fears of supply shortages. Later reports suggested the waterway had reopened, though details remained unclear.
Analysts believe Iran understands that major disruptions in the Strait of Hormuz could send oil prices sharply higher, potentially toward $150 per barrel. Such a spike would have significant global economic consequences.
Meanwhile, political consultancy Eurasia Group estimates a 65% probability of U.S. military strikes against Iran by the end of April, adding further uncertainty to the oil market outlook.
U.S. Oil Inventory Data in Focus
Traders are also monitoring U.S. crude inventory reports. The American Petroleum Institute is set to release its weekly data later Wednesday, followed by the Energy Information Administration report on Thursday.
Analysts surveyed by Reuters expect U.S. crude stockpiles to have increased last week. Inventory data could influence short-term oil price movements.
