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Crude oil prices rose in early trade on Tuesday as investors assessed the progress of negotiations between the United States and Iran, with continued uncertainty keeping market sentiment tense.
West Texas Intermediate (WTI) futures rose 1.45% to $99.97 a barrel, while Brent Crude rose 1.20% to $109.53 a barrel in early trade.
US President Donald Trump reportedly discussed Tehran's proposal to reopen the Strait of Hormuz provided sanctions are lifted and the conflict ends.
However, Washington remains cautious and insists any easing of restrictions will only happen after a deal is fully finalized.
Disruptions in the Strait of Hormuz continue to be a key driver of the market, with the strategic route handling nearly 20% of global oil supply. Around 20 million barrels per day of crude, fuel and petrochemical flows are now affected, adding to the pressure on global supplies.
Industry analysts expect that even if the conflict ends quickly, the market will need several months to stabilize as the process of clearing the routes, reducing shipping congestion and restoring refinery operations continues.
In the short term, oil prices are expected to remain high with the risk of further increases if the conflict continues. Without progress in negotiations, WTI could potentially return to $100 a barrel while Brent could exceed $110, reflecting concerns about global inventory depletion.
