Oil prices rise as US-Iran talks remain uncertain
What's the story
Oil prices have resumed their upward trend after a three-day slump, amid uncertainty over the US-Iran peace deal negotiations. The international benchmark Brent crude for July delivery rose by 1.9% to $104.52 a barrel in early Asian trading today. Meanwhile, US West Texas Intermediate futures for June also saw an increase of 1.5% at $97.81 per barrel.
Diplomatic tensions
Iran's Supreme Leader issues warning against sending uranium abroad
Iran's Supreme Leader Ayatollah Mojtaba Khamenei has ordered that near-weapons-grade uranium should not be sent abroad. This hardline position could further complicate the ongoing peace talks between the US and Iran, which are aimed at ending the US-Israeli war on Iran. The directive comes despite US President Donald Trump's earlier statements that Washington was in the "final stages" of negotiations with Tehran.
Supply concerns
IEA warns of 'red zone' for oil markets
The International Energy Agency (IEA) has warned that rising travel demand in summer could push oil markets into a "red zone" as global stocks dwindle. IEA Executive Director Fatih Birol stressed that the full and unconditional reopening of the Strait of Hormuz would be key to resolving the energy shock caused by the Iran war. He also noted that developing Asian and African countries will bear the brunt of this crisis.
Trade impact
Full normalization of Middle East oil supply may take years
The ongoing Iran war, which began in late February, has disrupted traffic through the vital Strait of Hormuz. The strait is a major transit route for nearly one-fifth of the world's oil and liquefied natural gas. Energy executives have warned that full normalization of Middle East oil supply may not happen until 2027 due to the scale of disruptions caused by this conflict.