Oil prices rise 4% on Tuesday

Oil prices rose about 4 per cent on Tuesday, with Brent reaching $103.94 per barrel and US West Texas Intermediate at $91.62, as supply fears intensified amid conflicting signals over potential de-escalation in the Gulf conflict.

Prices rebounded after a sharp drop of more than 10 per cent in the previous session, when US President Donald Trump ordered a five-day delay to planned strikes on Iran’s power infrastructure and suggested progress in talks. However, Iran denied any negotiations with Washington, heightening uncertainty in the market.

The conflict has disrupted shipments through the Strait of Hormuz, which handles around one-fifth of global oil and liquefied natural gas flows, although limited tanker traffic resumed on Monday.

Analysts said the temporary pause in military action reduced the war premium, but ongoing risks continue to support prices. Projections indicate Brent could stabilise between $85 and $90 per barrel, with potential to climb back towards $110, and possibly reach $150 if disruptions persist through April.

Meanwhile, attacks on energy infrastructure in Isfahan and Khorramshahr underscored continued instability. To ease supply concerns, the United States temporarily waived sanctions on Russian and Iranian oil already at sea, while the International Energy Agency said it is consulting governments on possible further strategic reserve releases if needed.

Markets are expected to remain volatile, with ongoing geopolitical tensions continuing to support oil prices and inflation pressures globally.

Attribution: Reuters