Oil gains over 3% as US-Iran peace talks in stalemate
USO•Brent crude rose 3.82% to $108.30 a barrel and WTI gained 3.81% to $95.93 after Trump rejected Iran’s peace proposal. He said he expected US negotiators to hold more talks this week.
1. Oil prices rebound
Brent futures rose $3.98, or 3.82%, to $108.30 a barrel, while WTI gained $3.52, or 3.81%, to $95.93. Hamad Hussain of Capital Economics said prices appeared to have jumped after Trump rejected Iran’s proposal.
2. Talks and supply flows
Iran said it sent its peace proposal to the United States through Qatari mediators. Trump rejected the plan on Saturday but told Axios on Sunday he expected US negotiators to engage in more talks this week. Hussain said higher flows through the Strait of Hormuz were easing some upward pressure, while the oil market remained in a deficit.
3. Exports and diesel risks
Middle East crude exports rebounded to 12.8 million barrels per day in September, the highest since the war began in February, preliminary Kpler data showed. Shipments through the Strait of Hormuz were set to reach about 7.4 million barrels per day this month. Goldman Sachs estimated that each week of a US diesel export ban would raise European wholesale diesel prices by $3 a barrel, or just under 2%.
