Crude Prices Climb As Diplomatic Deadlock Persists Between Washington, Tehran
By Sunday Etuka
Oil markets pushed higher on Monday, with both major benchmarks gaining roughly 2% after President Trump turned down a proposed settlement aimed at easing tensions with Iran and restoring normal shipping through the Strait of Hormuz.
By 1320 GMT, Brent crude had climbed $1.68, or 1.6%, to reach $106 a barrel, touching its strongest level since September 15 during the session. West Texas Intermediate rose $1.69, or 1.8%, to trade at $94.10.
The proposal originated from Iran, which unveiled it last week during the UN General Assembly in New York and said the offer reached Washington through Qatari intermediaries. Trump confirmed on Saturday that he had turned down the plan, though he indicated to Axios the following day that he anticipated American negotiators would resume discussions this week.
According to a source familiar with the matter, mediators are due to hold separate meetings with US and Iranian representatives on Monday or Tuesday.
Adding to market unease, renewed hostilities between Saudi Arabia and Yemen’s Houthi movement raised fresh questions about the safety of regional energy infrastructure, said Mahmoud Mashal, an analyst at VT Markets Dubai. The Saudi-led coalition reported early Saturday that it had shot down two ballistic missiles and two drones fired toward the kingdom by the Iran-aligned group.
Meanwhile, preliminary figures from Kpler released Monday showed that oil exports from major Middle Eastern producers rebounded in September to 12.8 million barrels per day — the strongest showing since fighting broke out in February — as both Saudi Arabia and the UAE ramped up shipments.
That recovery was driven partly by increased flows through the Strait of Hormuz, projected to reach about 7.4 million barrels per day this month. Saudi Arabia had rerouted some exports from its Red Sea terminal at Yanbu to the eastern Ras Tanura port after strikes damaged its East-West pipeline.
Still, UBS analyst Giovanni Staunovo cautioned that even with more ships moving through Hormuz, overall flows remain below levels seen before the conflict began, leaving the market tight.
Last week, Brent posted a modest 0.4% gain, while WTI dropped more than 7% amid speculation that Washington might restrict diesel exports to bring down domestic prices — a move analysts warn could squeeze US refining capacity.(Reuters)
