Oil prices edged higher on Tuesday for the third day in a row as prospects for a deal to end the war in the Middle East deteriorated, with Iran saying it would take a more offensive stance and the United States ruling out extending the ceasefire agreement, heightening concerns about prolonged disruptions to energy supplies, UNN writes, citing Reuters.
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Brent crude oil futures rose 7 cents, or 0.08%, to $90.94 a barrel by 10:31 GMT (13:31 Kyiv time). U.S. West Texas Intermediate crude futures rose 53 cents, or 0.63%, to $85.03 a barrel.
Brent and WTI futures had traded at their highest levels since July 30 and 31, respectively, earlier in the session.
"Sentiment remains supported by U.S. President Donald Trump's decision not to extend the peace agreement between the United States and Iran, as well as persistent concerns about security in the Strait of Hormuz," ING analysts wrote in a note.
Progress in peace talks and the resumption of oil tanker traffic through the strategic Strait of Hormuz has stalled, threatening to prolong the conflict that the United States and Israel began by attacking Iran on February 28, the publication writes.
Iran will keep the Strait of Hormuz closed until the United States fulfills the terms of the interim agreement signed in June, Iran's chief negotiator Mohammad Bagher Ghalibaf said in comments published by state media on Tuesday. Trump previously called the agreement "over."
Ghalibaf's comments came after a senior Iranian official told Reuters on Monday that Iran would shift to a "fully offensive" military posture, as efforts to reach a final end to the war had reached an impasse.
"The absence of any agreement will affect expectations for oil prices going forward, in the fourth quarter and even in 2027," said DBS Bank's head of energy research, Souvro Sarkar.
However, some oil is passing through the Strait of Hormuz, although the number of crossings is in the single digits. Saudi Aramco has resumed loading oil from the Strait of Hormuz and is offering cargoes to be loaded via ship-to-ship transfers off Fujairah in the UAE.
"Iran likely has the ability to completely halt the flow of oil through the Strait of Hormuz when it considers it appropriate," said SEB analyst Bjarne Schieldrop.
Iran has separately been negotiating with Oman on an agreement to manage the Strait of Hormuz and says they are close to a deal. But Trump responded to the talks by threatening to bomb Oman, a longtime U.S. security partner.
Elsewhere in the Middle East, Yemen's Houthis launched missiles in attacks on vessels they described as a Saudi warship and four escort vessels in the Red Sea, their military spokesperson Yahya Saree said on Telegram.
Oil prices rose amid uncertainty in the Middle East17.08.26, 05:57