New York (TDI): Oil prices edged lower on Tuesday, retreating from the previous session’s strong gains as traders reacted cautiously to mixed signals over US–Iran negotiations and broader Middle East tensions.
Brent crude futures fell by 75 cents, or 0.79%, to $94.23 a barrel at 0434 GMT, while West Texas Intermediate (WTI) dropped 85 cents, or 0.92%, to $91.31 a barrel. Both benchmarks had surged more than 5% in the prior session, after weeks of volatility driven by shifting geopolitical expectations.
Sentiment in the market remained fragile following conflicting statements from Washington and Tehran. US President Donald Trump said on Monday that discussions with Iran were still ongoing, even as Iranian state-linked Tasnim news agency reported that Tehran had suspended indirect negotiations with the United States.
Adding to the uncertainty, Trump told CNBC he would not be concerned if talks collapsed, but later suggested in separate remarks that negotiations were continuing and that a potential agreement could help stabilize the region, including reopening key shipping routes such as the Strait of Hormuz.
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Market analysts said the lack of clarity has kept risk premiums elevated in oil prices, as traders struggle to assess whether diplomatic progress is genuinely being made or whether tensions could escalate further.
The volatility has been further amplified by ongoing instability in the Middle East. Lebanon recently announced a partial ceasefire between Hezbollah and Israel, though sporadic clashes have continued, feeding into broader regional concerns tied to the US–Iran conflict.
Analysts warn that oil markets are likely to remain sensitive to any new developments, particularly statements from political leaders and reports involving maritime security in critical waterways.
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Iran’s actions in recent months have already disrupted shipping through the Gulf, affecting a significant share of global oil and LNG supply and contributing to earlier price spikes.
Meanwhile, US crude exports have climbed to record levels, as refiners in Asia and Europe increase purchases amid supply concerns from the Middle East. Preliminary data also suggests a decline in US crude inventories, adding another layer of complexity to market dynamics.
Shipping industry officials, meeting in Athens, said any potential US–Iran agreement would need to establish clear maritime rules to ensure the safe and predictable movement of vessels through key trade routes.
