Oil prices continued to climb on Thursday amid concerns that supply disruptions from the Middle East could persist for a longer period, as talks aimed at ending the U.S.-Israeli war against Iran have reached a deadlock.
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Brent crude futures rose to their highest level in four years, reaching $124.67 per barrel, driven by fears of a potential escalation in the conflict between the United States and Iran.
U.S. crude futures also increased by more than $2 to $109.64 per barrel, marking their highest level since April 7.
Axios reported on Wednesday that U.S. President Donald Trump is set to receive a briefing from U.S. Central Command chief Brad Cooper regarding new plans for possible military action in Iran.
A White House official stated on Wednesday that President Donald Trump had spoken with oil companies about ways to mitigate the impact of a U.S. blockade of Iranian ports if it continues for months—raising market concerns over prolonged disruptions to oil supplies.
Tony Sycamore, a market analyst at IG, commented in a note: “The chances of a near-term resolution to the Iran conflict or the reopening of the Strait of Hormuz remain slim.”
The meeting with oil companies comes after efforts to resolve the conflict—which has claimed thousands of lives and caused what analysts describe as the largest disruption to global energy supplies ever—have stalled.
On the supply side, sources told Reuters that the OPEC+ alliance, which includes members of the Organization of the Petroleum Exporting Countries (OPEC) and allied producers, is likely to agree on Sunday to a modest increase in oil production quotas of about 188,000 barrels per day.
The meeting comes immediately after the UAE’s withdrawal from OPEC, a move expected to deal a blow to the group’s ability to control prices. Although the UAE’s exit would allow it to boost production after resuming exports, analysts say this is unlikely to affect market fundamentals this year, particularly with the closure of the Strait of Hormuz and other production disruptions caused by the war.
Reuters
