Oil prices are bouncing back today following the US Navy’s capture of an Iranian cargo vessel on Sunday, dampening optimism for a peace agreement between Washington and Tehran amid anticipated discussions this week.
Brent crude, the worldwide oil standard, has increased by 6.3% to $96 per barrel. WTI, the US standard, has risen 7% to $88.3 per barrel.
Since Friday, when Iran announced its plan to reopen the Strait of Hormuz, oil prices have experienced significant fluctuations. Brent fell over 9% that day, closing at its lowest point since March 10. However, Tehran subsequently shut down the crucial waterway the next day, referencing the persistent US blockade of Iranian ports. Brent rose following the market’s late Sunday reopening.
Iran’s reversal on the strait “has deflated market enthusiasm,” yet investors stayed “unexpectedly” positive, remarked Thomas Mathews, head of Asia-Pacific markets at consultancy Capital Economics. “The suggested likelihoods of an agreement in prediction markets remain fairly elevated,” he stated in a note on Monday.
Asian stock markets made gains on Monday, while European major indexes experienced declines in the morning hours. US futures indicated a modestly lower start.
Iran’s military cautioned it would act against what it termed “maritime highway robbery” by the United States, following US forces’ gunfire at and subsequent boarding of an Iranian ship in the Gulf of Oman. US President Donald Trump, in the meantime, restated threats to strike Iranian power facilities and bridges if Iran did not agree to Washington’s “very fair and reasonable deal.”
According to ship tracking data, no tankers traversed the Strait of Hormuz on Sunday, marking one of the most tranquil days in the channel since the onset of the conflict.
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