Brent-WTI Rebounds Sharply, Market Doubts US-Iran Talks
Oil prices surged on Monday (April 20th) after uncertainty over US-Iran peace talks intensified following escalation around the Strait of Hormuz. Brent closed up 5.64% to US$95.48/barrel, while WTI rose 6.87% to US$89.61/barrel.
This rise reversed Friday's sharp decline, when both contracts plunged about 9% after Iran declared the Hormuz commercial waterway open for the remainder of the ceasefire period. However, over the weekend, the US seized an Iranian-flagged cargo ship it said was attempting to breach the blockade, while Tehran threatened retaliation—sparking fears of renewed hostilities.
With a two-week ceasefire scheduled to expire this weekend, the latest escalation further casts doubt on the chances of a second round of US-Iran talks in Pakistan. A senior Iranian official said Tehran was still considering attending, but no decision had been made. Iranian Foreign Minister Abbas Araqchi also conveyed to Pakistani Foreign Minister Ishaq Dar that "continued violations" by the US are a major obstacle to the continuation of the diplomatic process. President Donald Trump himself stated that he was uncertain about extending the ceasefire, but confirmed that the blockade would remain in place.
Market implications: Oil has again adopted a supply risk premium, as output and physical flows from the Gulf region are highly sensitive to the status of Hormuz and blockade/retaliatory measures. The next focus will be the decision on extending the ceasefire, the certainty of the schedule/format of the Pakistani negotiations, and developments in maritime incidents that could rapidly change price direction. (Arl)*
Source: Newsmaker.id
