Brent crude prices moved higher on Tuesday, recovering more than 2% after U.S. military operations in Iran intensified concerns around the ongoing conflict. Investors remain focused on whether diplomatic efforts can end the war and restore normal shipping activity through the strategically important Strait of Hormuz.
Brent futures climbed by $2.36, or 2.5%, reaching $98.50 per barrel by 06:30 GMT. The gain followed a sharp 7% decline recorded in the previous trading session.
Meanwhile, U.S. West Texas Intermediate (WTI) crude traded at $91.95 per barrel. Although slightly higher than Monday’s last traded level, WTI remained nearly 5% below Friday’s closing price. No official settlement occurred on Monday due to the U.S. Memorial Day holiday.
Military Escalation Drives Oil Market Volatility
According to Michael McCarthy, CEO of trading platform Moomoo Australia, hopes surrounding a possible peace agreement initially pressured oil prices overnight. However, renewed military activity — including U.S. strikes in southern Iran and Israeli operations targeting Hezbollah — quickly reversed sentiment and supported Brent prices.
The increased geopolitical tension has also widened the pricing gap between Brent crude and WTI benchmarks.
U.S. Secretary of State Marco Rubio stated on Tuesday that reaching an agreement with Iran may still require several days of negotiations, reducing expectations for an immediate resolution.
His comments came shortly after Washington described recent U.S. military operations in southern Iran as defensive actions.
Strait of Hormuz Remains a Critical Risk Factor
Since the conflict began, Iran has effectively disrupted most foreign shipping activity through the Strait of Hormuz. The waterway is considered one of the world’s most important energy routes, facilitating roughly one-fifth of global oil and liquefied natural gas transport.
The latest strikes occurred while Iranian officials, including the country’s foreign minister and chief negotiator, were meeting in Doha with Qatar’s prime minister to discuss a potential framework agreement with the United States aimed at ending the conflict.
Both Tehran and Washington reportedly acknowledged progress toward a memorandum of understanding that could halt hostilities and provide negotiators with a 60-day window to finalize a broader agreement.
Potential Deal Could Reopen Global Energy Flows
Reports citing diplomatic sources suggest Iran may agree to remove naval mines from the Strait of Hormuz within 30 days if a deal is reached. Under such conditions, international shipping traffic could resume freely while Iran would reportedly stop collecting transit fees.
Tim Waterer, chief market analyst at KCM Trade, said investors are increasingly positioning for a breakthrough that could release energy shipments delayed around the strait for months.
Recent shipping data indicates movement is gradually resuming, with several liquefied natural gas carriers successfully crossing the route toward Pakistan, China, and India. A supertanker transporting Iraqi crude to China also reportedly passed through after remaining stranded for nearly three months.
Trump Renews Pressure on Iran
On Monday, U.S. President Donald Trump repeated calls for Iran to surrender its enriched uranium stockpile for destruction.
Analysts warn that despite signs of progress, negotiations remain fragile.
Tony Sycamore, market analyst at IG, noted that the situation serves as another reminder that diplomatic agreements can still collapse unexpectedly, similar to multiple previous failed attempts.
The uncertainty continues to keep oil markets highly sensitive to developments surrounding Iran, U.S. policy decisions, and the future accessibility of the Strait of Hormuz.
