Oil prices were broadly unchanged on Thursday, trimming earlier losses as investors remained unconvinced that ongoing negotiations between the United States and Iran will quickly lead to a resolution of the conflict that has constrained supply from the Middle East.
Brent crude futures fell 26 cents to $94.67 per barrel by 06:11 GMT, while U.S. West Texas Intermediate crude edged up 14 cents to $91.43 per barrel. Both benchmarks ended the previous session near flat levels, although trading was marked by significant intraday swings.
The conflict involving the U.S., Israel and Iran has triggered major disruptions to global oil and gas supply, largely due to Iran restricting movement through the Strait of Hormuz—a critical corridor that typically handles around 20% of worldwide oil and LNG shipments.
“While there are hopes for de-escalation, many investors remain sceptical, given that U.S.-Iran talks have repeatedly broken down even after appearing to make progress,” said Toshitaka Tazawa, an analyst at Fujitomi Securities.
“Until a peace deal is reached and free navigation through the strait is restored, WTI prices are expected to continue fluctuating between $80 and $100,” he added.
ING analysts estimate that approximately 13 million barrels per day of oil flows have been impacted by the disruption, even after factoring in alternative pipeline routes and limited tanker movements through the strait. They warned that the situation could deteriorate further following Washington’s decision to impose a blockade on Iranian ports after negotiations collapsed over the weekend.
“The physical market is becoming tighter every day that passes without a restart of oil flows through the Strait of Hormuz,” the ING analysts said.
A source with knowledge of discussions in Tehran told Reuters that Iran may consider allowing vessels to pass via the Omani side of the Strait of Hormuz if an agreement is reached to prevent renewed hostilities after the two-week ceasefire that began on April 8.
Officials from both the U.S. and Iran are reportedly considering returning to Pakistan for additional talks as early as this weekend. Pakistan’s army chief arrived in Tehran on Wednesday to help mediate and avoid a fresh escalation.
U.S. Treasury Secretary Scott Bessent said on Wednesday that Washington will not extend waivers that previously allowed certain purchases of Iranian and Russian crude without triggering sanctions.
Highlighting the strain in global supply, U.S. government data showed declines in crude, gasoline and distillate inventories last week, as reduced imports and increased exports reflected efforts to compensate for disrupted flows.
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