Oil Prices Trim Gains After Reports of Potential U.S.-Iran Agreement
Oil prices sharply reduced earlier gains on Thursday and turned mixed after reports suggested Washington and Tehran had reached a preliminary agreement to extend the current ceasefire and continue negotiations over Iran’s nuclear program.
According to the report, the potential agreement is still awaiting final approval from U.S. President Donald Trump.
Crude Prices Initially Rose After Fresh U.S.-Iran Strikes
Earlier in the session, oil prices moved higher after renewed military strikes between the United States and Iran reignited concerns over stability in the Middle East and the future of the Strait of Hormuz.
By 10:20 ET (14:20 GMT), Brent crude futures for August delivery were up 0.2% at $92.36 per barrel, while U.S. West Texas Intermediate crude futures for July delivery also gained 0.2% to $88.86 per barrel.
Iran’s Islamic Revolutionary Guard Corps stated that it had targeted a U.S. airbase in Kuwait in retaliation for American strikes on the Iranian port city of Bandar Abbas earlier in the day.
Meanwhile, Kuwait confirmed it was responding to missile and drone attacks, although officials did not identify the source of the attacks.
Ceasefire Uncertainty Keeps Markets Volatile
The latest exchange of strikes marked a renewed escalation between the U.S. and Iran despite repeated statements from Washington claiming that a ceasefire agreement remained in place.
The United States launched strikes against Iran earlier this week, describing the operation as defensive.
Tensions intensified further after President Donald Trump dismissed reports suggesting that Iran would reopen commercial shipping through the Strait of Hormuz within the next month.
Trump also indicated that he was not fully satisfied with the terms of a possible peace agreement aimed at ending the three-month conflict.
Strait of Hormuz Remains Critical for Global Oil Supply
Oil markets remain highly sensitive to developments surrounding the Strait of Hormuz, a key shipping route responsible for transporting roughly one-fifth of global oil supplies.
Although shipping traffic through the strait has continued at reduced levels during the conflict, flows remain significantly below pre-war volumes.
President Trump also rejected the idea of Iran and Oman jointly controlling the strategic waterway, stating that no single country should dominate access to the channel.
Markets Continue to Monitor Peace Negotiations
Oil prices had fallen sharply earlier this week amid expectations that a U.S.-Iran peace agreement was close.
However, Trump’s latest comments suggested negotiations may still face major obstacles, particularly regarding Tehran’s nuclear activities and future control of the Strait of Hormuz.
Analysts at Yardeni Research warned that both Iran and the global oil market may be approaching a critical stage.
According to the firm, Iran is facing limited oil storage capacity that could eventually force production shutdowns, while global oil supplies remain tight enough that prolonged disruptions could begin affecting pipelines and broader energy infrastructure.
