Oil prices rose in early trade on Tuesday as markets assessed supply risks following Iran's denial of talks with the United States, contradicting President Donald Trump's earlier claims. Brent crude futures climbed $1.06 to $101 per barrel, while U.S. West Texas Intermediate (WTI) increased $1.58 to $89.71. The price drop on Monday came after Trump announced a five-day delay in planned strikes on Iran's power plants and claimed productive talks had taken place, which Iran later dismissed as market manipulation.
European stocks were poised to decline on Tuesday as investors monitored Middle East tensions. The UK's FTSE 100, Germany's DAX, and France's CAC 40 were expected to open lower. Meanwhile, U.S. markets surged on Monday after Trump's comments, with the Dow Jones Industrial Average closing up 631 points. Oil prices had plunged over 10% on Monday but remained above $100 per barrel.
Analysts noted that while tensions may have eased temporarily, the Strait of Hormuz remains a critical concern. Macquarie projected Brent could reach $150 per barrel if the strait remains closed until April. Iran's Revolutionary Guards launched new attacks on U.S. targets, calling Trump's claims 'psychological operations.' The conflict has disrupted about one-fifth of global oil and gas shipments, though some tankers have resumed passage.
The market's volatility reflects uncertainty over the conflict's resolution and its impact on energy supplies. While Trump emphasized the potential for a deal, Iran's rejection of talks suggests ongoing friction. Analysts warn that even if tensions ease, oil prices may remain elevated until the Strait of Hormuz reopens fully.