Oil prices were broadly flat in early Asian trade on Thursday, as a fragile cocktail of diplomatic optimism and worsening supply shortages kept traders on edge.
WTI was trading at around $91.38 per barrel, up just 0.1%, while Brent nudged 0.04% higher to $94.97. Both benchmarks remain well off the highs seen earlier in the week when tensions in the Strait of Hormuz sent crude past $100.
US-Iran Talks Ease Pressure on Oil Prices
The White House described recent US-Iran negotiations as “productive” and signalled that further talks could follow within days, easing the pressure on oil prices. That language was enough to keep the market from spiking further, though few traders are ready to price in a full resolution just yet.
Reports that China’s Foreign Minister urged his Iranian counterpart to reopen the Strait of Hormuz added to cautious optimism that the world’s most critical oil chokepoint could eventually be unblocked. Separately, reports of an Israel-Lebanon ceasefire are also being watched as a potential temperature-reducer for the broader region.
The ongoing US naval blockade has so far successfully halted Iranian-linked shipping through the Strait, which analysts say has been central to pressuring Tehran back to the negotiating table.
In the meantime, US crude exports have surged to record levels as buyers across Asia and Europe scramble to replace missing Middle Eastern barrels — a dynamic that is pushing up landed costs for oil everywhere, including East Africa.
Traders remain torn between fragile diplomatic optimism and an ever-tightening supply picture. The market wants to believe a deal is coming. The physical market, however, is not waiting — and neither are importers who are already paying more to move oil from wherever they can find it.
Read: Oil Prices Spike over 11% as Strait of Hormuz Remains Closed
