Oil Prices Extend Gains as US-Iran Talks Stall
Oil prices continued their upward momentum on Thursday, climbing by more than $1 as negotiations between the United States and Iran showed no meaningful progress. Ongoing restrictions from both sides on trade flows through the Strait of Hormuz further tightened global supply expectations.
Brent and WTI Move Higher
Brent crude futures rose by $1.26, or 1.2%, reaching $103.17 per barrel at 0630 GMT, after closing above the $100 mark for the first time in over two weeks during the previous session. Meanwhile, West Texas Intermediate (WTI) futures gained $1.20, or 1.3%, to trade at $94.16 per barrel.
Both oil benchmarks had already surged by more than $3 on Wednesday, driven by stronger-than-expected declines in U.S. gasoline and distillate inventories, alongside persistent uncertainty surrounding US-Iran negotiations.
Market Repricing Amid Geopolitical Uncertainty
Analysts at ING noted that the oil market is adjusting its expectations due to the lack of progress toward a resolution in the Persian Gulf. As talks remain stalled, hopes for a diplomatic breakthrough continue to fade.
They also highlighted that Iran’s recent seizure of vessels attempting to pass through the Strait of Hormuz signals that disruptions to oil shipments are likely to persist in the near term.
Tensions Persist Despite Ceasefire Extension
Although U.S. President Donald Trump agreed to extend a ceasefire following mediation efforts by Pakistan, restrictions on maritime transit remain firmly in place. The strategic waterway previously handled around 20% of global daily oil supply before the conflict escalated on February 28.
Iran intensified its control over the region by seizing two ships on Wednesday, reinforcing its grip on the critical chokepoint. At the same time, the United States continues to enforce a naval blockade targeting Iran’s maritime trade.
Iranian parliament speaker and chief negotiator Mohammad Baqer Qalibaf stated that a full ceasefire would only be viable if the U.S. lifted its blockade measures.
Tanker Interceptions Add to Supply Concerns
U.S. military forces have intercepted at least three Iranian-flagged tankers in Asian waters, redirecting them away from key areas near India, Malaysia, and Sri Lanka. These developments have added another layer of uncertainty to global oil supply chains.
Despite earlier warnings of potential military escalation targeting Iranian infrastructure, Trump has refrained from immediate action and has not specified an end date for the extended ceasefire, according to White House press secretary Karoline Leavitt.
US Oil Exports Hit Record Levels
On the supply side, U.S. crude oil and petroleum product exports surged by 137,000 barrels per day, reaching a record high of 12.88 million bpd. Increased demand from Asian and European buyers—seeking alternatives amid Iran-related disruptions—has supported export growth.
Mixed US Inventory Data
According to the Energy Information Administration, U.S. crude inventories rose by 1.9 million barrels, exceeding expectations for a 1.2 million-barrel decline.
In contrast, gasoline stockpiles dropped sharply by 4.6 million barrels, significantly more than the projected 1.5 million-barrel decrease. Distillate inventories also declined by 3.4 million barrels, surpassing forecasts of a 2.5 million-barrel reduction.
