Oil is back above $100 despite Trump’s comments on ending the war
By Hanna Ziady, CNN
London (CNN) — Oil prices rose Tuesday after fresh fighting overnight between Israel and Iran diminished hopes that an end to the Middle East war, now in its fourth week, might be imminent.
Brent crude, the global oil benchmark, climbed almost 1.8% to $101.7 a barrel. WTI, the US benchmark, rose 2.8% to $90.6 a barrel.
Brent had reached more than $114 a barrel Monday on worries about a major escalation after US President Donald Trump threatened to “obliterate” Iranian power plants if Tehran did not reopen the Strait of Hormuz.
The oil price then plunged, settling at $99.94 for the day, after Trump hailed “very good and productive conversations” with Iran about ending the war. He also postponed for five days military strikes against Iranian power plants and other energy infrastructure.
Iran has denied any dialogue with Washington, however, though sources have told CNN that mediation efforts are underway by other countries, including Turkey and Egypt. Pakistan, meanwhile, has offered to host negotiations.
Financial markets took signs that the two sides might be talking as a “huge positive,” because it opened up the possibility of a “much quicker end to the conflict,” Jim Reid, head of global macroeconomic research at Deutsche Bank, wrote in a note Tuesday. “Obviously much now depends on the progress of any talks, and whether the more optimistic rhetoric is followed up by concrete action,” he added.
Despite reports of talks between the two parties, Iran and US ally Israel continued to trade strikes overnight. The Israel Defense Forces sent search and rescue teams to “several sites,” including in Tel Aviv, in the early hours of Tuesday, following a barrage of missiles from Iran. Meanwhile, Israel’s air force struck more than 50 targets in Iran overnight, Israeli authorities said. Israeli strikes against southern Lebanon have also intensified.
Stock markets were mixed Tuesday, as traders weighed hopes for a prompt end to the war against evidence of attacks overnight. Asian markets pared some of Monday’s losses to close higher in Seoul, Tokyo and Hong Kong.
In Europe, markets fell in morning trade, partly reversing the previous day’s gains. US futures also pointed to a weaker open. “The peak optimism from yesterday didn’t last long and has not really followed through today,” Neil Wilson, a strategist at investment platform Saxo, said in a note Tuesday.
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