Comment: Oil back above $100 amid US-Iran talks speculation

Brent has moved higher as disruption around the Strait of Hormuz continues and hopes of a near-term US-Iran breakthrough fade, keeping supply concerns in focus.

Nikos Tzabouras, Senior Market Analyst at Jefferies-owned Tradu.com, comments on oil’s move back above $100, and says ongoing supply tightness and geopolitical uncertainty are supporting prices and keeping the risk premium elevated. However, he adds that the pause in escalation opens the door to a potential diplomatic resolution, which could see supply return and prices ease.

Nikos commented:

“Oil prices are regaining their footing and Brent returns above the $100 mark as US-Iran optimism fades and the reality on the ground is unchanged. The Strait of Hormuz remains effectively closed and supply disruptions linger, tightening the market and potentially shifting previously unfavourable fundamentals. Moreover, with a five-day delay imposed on strikes against energy facilities, markets now face another cliffhanger that keeps the risk premium elevated and could push crude prices higher still.

“Nonetheless, Trump’s postponement removes the immediate escalation risk and provides an off-ramp toward the conclusion of hostilities, creating scope for deeper pullbacks in oil prices. A deal would allow the restoration of oil flows, and a well-supplied market may yet absorb the shock more quickly than feared.”