Brent crude futures rose above $95 a barrel on Thursday, recovering earlier losses as traders weighed renewed diplomatic engagement between the United States and Iran alongside persistent risks to global oil supply.
Markets are closely watching reports that Washington and Tehran are considering extending a fragile ceasefire to allow more time for negotiations aimed at a broader peace agreement. Any deal is expected to focus on reopening the Strait of Hormuz, a critical global oil transit route that remains effectively disrupted.
The Strait continues to operate under severe constraints following ongoing military tensions and a U.S. naval blockade targeting Iranian-linked shipping, keeping a significant portion of regional crude flows restricted and supporting elevated price levels.
Attention is now shifting to a potential second round of US–Iran talks, which are expected to focus on maritime access through the Strait as well as Iran’s nuclear enrichment programme. Analysts say progress in negotiations could ease supply risks, while failure could quickly reverse recent price stability.
Despite intermittent diplomatic optimism, energy flows remain heavily disrupted. Market data shows shipments through the Strait are still far below normal levels, with global oil trade continuing to operate under heightened geopolitical risk.
Oil prices have been highly volatile since the conflict escalated, with traders reacting sharply to each development in ceasefire talks, military positioning, and shipping security conditions.
Analysts warn that while diplomatic progress could ease inflationary pressure, any breakdown in talks or escalation in maritime tensions could quickly push prices higher again, given the Strait’s central role in global energy supply.