Oil prices held steady on Thursday, reversing earlier losses as investor scepticism over the outcome of US-Iran peace talks offset initial optimism about a potential resolution to the conflict.
Brent crude edged up 9 cents to $95.02 per barrel, while US West Texas Intermediate (WTI) rose 44 cents to $91.73 per barrel. Both benchmarks had settled largely unchanged in the previous session, though trading remained volatile.
Despite signals of progress, markets remain cautious about the likelihood of a breakthrough. The ongoing conflict involving the US, Israel, and Iran has severely disrupted global oil and gas supplies, largely due to restricted movement through the Strait of Hormuz—a critical route that typically handles about 20 percent of global oil and liquefied natural gas flows.
Analysts note that repeated breakdowns in US-Iran negotiations have dampened confidence. Until a concrete agreement is reached and normal shipping resumes, oil prices are expected to remain volatile within a broad range.
Supply disruptions remain significant. Estimates suggest that around 13 million barrels per day of oil flow have been affected due to the strait’s closure, even after accounting for alternative routes and limited tanker movement. The situation could worsen further following the US blockade on Iranian ports after recent talks collapsed.
However, there are tentative signs of flexibility. Iran has reportedly proposed allowing ships to pass safely through the Omani side of the Strait of Hormuz if a durable agreement is reached following the ongoing ceasefire.
Diplomatic efforts are continuing, with US and Iranian officials considering further talks in Pakistan. Meanwhile, Pakistan has stepped in as a mediator, with its army chief recently visiting Tehran to help prevent renewed hostilities.
Adding to supply concerns, the US has decided not to extend waivers that previously allowed limited purchases of Iranian and Russian oil without sanctions.
In the United States, fresh data showed declines in crude, gasoline, and distillate inventories. Lower imports and a surge in exports—driven by strong global demand—highlight the tightening supply situation as countries seek alternatives to disrupted Middle Eastern flows.
Overall, the oil market remains on edge, balancing fragile diplomatic progress against persistent supply constraints and geopolitical uncertainty.
