On Tuesday, oil prices showed mixed results as geopolitical tensions influenced trading. Brent crude futures rose by 1.6% to $97.72 per barrel, while U.S. West Texas Intermediate futures fell by 5.4% to $91.38 per barrel. The U.S. military confirmed operations in southern Iran aimed at neutralizing threats from Iranian forces, specifically targeting vessels and missile launch sites.
President Trump's comments added to the uncertainty; he indicated that while negotiations with Iran were progressing, military action could resume if talks failed. Additionally, he encouraged several Middle Eastern nations to normalize relations with Israel through the Abraham Accords.
UBS highlighted that the global oil market is under strain, with significant inventory declines reported—246 million barrels in March and April alone—suggesting a strong undersupply in the market. This situation is exacerbated by disruptions in oil shipments through the Strait of Hormuz, raising concerns about future supply stability