Oil prices rose on Monday as expectations for a breakthrough in U.S.-Iran peace talks faded and tanker traffic through the Strait of Hormuz slowed, heightening concerns over geopolitical risks in the market.
Brent crude futures rose 1% to $89.40 a barrel, after gaining 72 cents to $89.20 by 02:29 GMT. U.S. West Texas Intermediate (WTI) crude futures rose 44 cents to $82.83 a barrel.
Both benchmarks had gained more than 5% last week following attacks targeting tankers operated by Abu Dhabi National Oil Company (ADNOC) in the Strait of Hormuz and a refinery belonging to Saudi oil giant Aramco.
At the start of the week, Iranian Foreign Minister Abbas Araghchi said Tehran had not yet decided whether to resume talks with the United States, while U.S. President Donald Trump urged Americans to accept a slight increase in gasoline prices as long as the conflict continues.
“Oil prices have now almost fully recovered from the lows recorded in early August, as hopes for a more sustainable resolution between the U.S. and Iran have faded and geopolitical risk premiums have returned to the market,” said Priyanka Sachdeva, head of market analysis at Phillip Nova in Singapore.
“However, I see limited upside from these levels unless we get clear evidence of renewed hostilities in the Strait of Hormuz, particularly physical damage to tankers or oil infrastructure,” she added.
Data on Monday showed that shipping traffic through the Strait of Hormuz slowed at the beginning of the week following attacks on oil tankers.
Vessel-tracking data from Kpler showed that five cargo vessels carrying essential commodities crossed the strait on Saturday, while no vessels were recorded crossing on Sunday, compared with 31 vessels at the beginning of the previous week.
The official Emirates News Agency (WAM) reported that the UAE accused Iran of attacking a third vessel operated by ADNOC while it was transiting the strait on Friday, after blaming Iran for two other incidents involving ADNOC vessels in the strait on Thursday evening.
Reuters
