Oil Prices Extend Gains Amid Rising Middle East Tensions
Oil prices continued to climb in Asian trading on Tuesday, as investors braced for potential escalation in the Middle East. Market focus remains on a key deadline set by U.S. President Donald Trump for Iran to reopen the Strait of Hormuz.
Brent crude futures for June delivery rose 0.4% to $110.20 per barrel, while West Texas Intermediate (WTI) crude advanced 0.8% to $113.32 per barrel.
Third Consecutive Session of Gains
The latest increase marks the third straight session of gains in oil markets. Prices have been supported by growing concerns over the Strait of Hormuz, a vital global oil transit route responsible for roughly one-fifth of worldwide shipments.
Recent disruptions to tanker traffic have tightened supply expectations and increased risk premiums across the energy market.
Strait of Hormuz Disruptions Drive Supply Fears
The ongoing conflict has significantly impacted shipping activity through the Strait, raising fears of further supply constraints. As a result, traders are increasingly pricing in the risk of prolonged disruption in global oil flows.
Ceasefire Talks Fail to Deliver Breakthrough
Diplomatic efforts to ease tensions appear to be losing momentum. Iran rejected a U.S.-backed proposal that included a 45-day ceasefire, a phased reopening of the Strait, and broader negotiations covering sanctions relief and reconstruction.
Instead, Tehran called for a comprehensive agreement involving a permanent end to hostilities, security guarantees, sanctions removal, and compensation for damages.
Trump Signals Potential Military Action
Donald Trump reiterated that the deadline remains firm, warning that failure to comply could result in U.S. strikes targeting Iranian infrastructure such as power plants and bridges.
His comments, including the suggestion that Iran could be neutralized quickly, have heightened fears of a wider regional conflict.
Markets on Edge Despite OPEC+ Supply Increase
The increasingly aggressive rhetoric has kept energy markets on high alert. While OPEC+ has moved to slightly increase production, the additional supply is widely viewed as insufficient to offset potential losses if disruptions in the Strait of Hormuz intensify.
