Oil prices rose by $3 per barrel on Monday, as the United States and Iran failed to reach an agreement on a peace deal proposed by Washington. Meanwhile, the Strait of Hormuz remains largely closed, maintaining high tension on the global energy supply.
The Brent futures contract rose by $3.18, or 3.14%, to settle at $104.47 per barrel at 23:36 GMT, extending a 1.23% gain from Friday.
The American West Texas Intermediate (WTI) was trading at $98.51 per barrel, up $3.09, or 3.24%, after closing the previous session with a 0.64% increase.
Hopes for a swift resolution to the conflict between the United States and Iran, which has been ongoing for ten weeks, and the potential reopening of oil transit through the Strait of Hormuz, were dampened on Sunday. President Donald Trump deemed the Iranian response to a peace talk proposal “unacceptable.”
Donald Trump is set to arrive in Beijing on Wednesday and is expected to discuss the Iranian issue, among other topics, with Chinese President Xi Jinping, according to US officials.
“The market’s attention is now firmly on President Trump’s visit to China this week,” noted market analyst Tony Sycamore from IG.
“We hope he can persuade Beijing to use its influence on Iran to push for a global ceasefire and a resolution to the ongoing disruptions in the Strait of Hormuz,” added Sycamore.
The world has lost about one billion barrels of oil in the past two months, and the energy markets will take time to stabilize, even if the flows resume, said Amin Nasser, CEO of Saudi Aramco, on Sunday.
Two more oil tankers carrying crude left the Strait of Hormuz last week with their transponders turned off to avoid Iranian attacks, as reported by shipment data from Kpler, highlighting a growing trend to maintain Middle Eastern oil exports.
