Oil prices increased slightly on Tuesday amid ongoing uncertainty over talks between the United States and Iran and speculation around the potential reopening of the Strait of Hormuz, one of the world’s most critical energy transit routes.Brent crude futures rose by 0.06% to $95.04 a barrel, while US West Texas Intermediate declined slightly by 0.18% to $91.99 a barrel in early trade.Oil markets held on to most of the previous session’s strong gains after sharp fluctuations driven by shifting signals on US–Iran negotiations and the evolving security situation in the Middle East. Sentiment remained fragile as traders assessed the likelihood of progress or breakdown in diplomatic engagement between Washington and Tehran, Reuters reported. US President Donald Trump on Monday said that discussions with Iran were ongoing. However, Iran’s Tasnim news agency reported that Tehran had suspended indirect negotiations with the United States, adding to market uncertainty over the future of talks.In a separate interview with CNBC, Trump suggested he did not object if talks had ended, before later posting on social media that negotiations were continuing. He also told ABC News he expected a possible deal that could extend the ceasefire and support the reopening of the Strait of Hormuz ‘over the next week’, according to a post shared by the outlet on X.Despite the conflicting signals, traders continued to focus on developments linked to the Strait of Hormuz, through which a significant share of global oil shipments passes. Any disruption or reopening of the route remains a key driver of risk sentiment in energy markets.Market analysts said prices were being driven largely by uncertainty rather than fundamentals. “The market is currently focused on whether there’s any concrete progress or setbacks in US-Iran negotiations, the tone and substance of statements from both sides, and actual physical tanker movements through the waterway,” said Tim Waterer, chief market analyst at KCM Trade.He added that the direction of negotiations would determine whether the current risk premium in oil prices is sustained or gradually unwinds.Lebanon also announced a partial ceasefire between Hezbollah and Israel on Monday, signalling a limited de-escalation in one front of the wider regional conflict involving Iran-backed groups.Separately, shipping and energy flows remain under pressure as geopolitical tensions continue to affect maritime security in key waterways. Earlier disruptions linked to the conflict have already significantly impacted tanker movements and global supply routes.US crude exports have meanwhile risen to record levels, supported by stronger demand from Asian and European refiners seeking alternative supply sources amid Middle East uncertainty.According to preliminary estimates, US crude inventories are also expected to have fallen in the latest reporting week, extending a trend of declining stockpiles and reinforcing concerns about tighter supply conditions.Shipping executives have warned that any future agreement between the US and Iran would need to establish clear rules for safe passage through the Strait of Hormuz before normal maritime operations can fully resume.
