(April 24): Oil climbed for a fifth day as President Donald Trump’s threats and brash social media posts were seen hampering the prospect of Iran agreeing to more in-person peace talks with the US.
West Texas Intermediate rose above US$96 a barrel, while Brent closed near US$105 on Thursday, taking this week’s advance to about 16%. Trump’s Truth Social posts — as well as his decision to continue with a naval blockade of Iranian ports — have been detrimental to ongoing negotiations through mediators such as Pakistan, according to two US officials familiar with the matter.
The war has rattled energy markets since it started at the end of February, with the near-closure of the Strait of Hormuz causing a sharp drop in flows from major oil and gas producers in the Persian Gulf. Fresh concerns that peace talks have stalled, an amping up of rhetoric, and increasing military threats are injecting a geopolitical premium into oil prices.
“The tensions are tightening a bit more now — the market is now pricing in a more intense standoff, with a longer duration,” said Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc.
Futures rose in Thursday’s session after Trump said in a social media post that he had ordered the US Navy to “shoot and kill” boats laying mines in the strait. Meanwhile, American forces boarded a supertanker carrying Iranian oil in the Indian Ocean, as the navy stepped up its blockade of the Islamic Republic’s shipping.
Efforts to revive talks between Washington and Tehran remain deadlocked on several other key issues, including the Islamic Republic’s nuclear capabilities and Israeli strikes on Lebanon. The ceasefire in Lebanon has been extended by three weeks, Trump said in a social media post.
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