WTI stays muted near $85.50 as the second phase of US-Iran negotiations approaches
WTI Crude Oil Price Retreats Amid Easing Supply Fears
The price of West Texas Intermediate (WTI) crude slipped to approximately $85.40 per barrel during Tuesday's Asian session, following modest gains the day before. The decline comes as concerns over oil supply begin to diminish, with news emerging that Iran plans to send officials to Islamabad for a second round of discussions with the United States ahead of the truce deadline.
According to Bloomberg, US President Donald Trump announced that Vice President JD Vance is scheduled to visit Pakistan to restart negotiations, potentially as early as Tuesday night or Wednesday morning. Trump also warned that the ceasefire is unlikely to be prolonged unless an agreement is finalized, emphasizing that the Strait of Hormuz will remain closed until a deal is reached.
Shipping activity through the Strait of Hormuz saw a significant slowdown on Monday, following heightened tensions over the weekend. Reports indicate that Iran fired warning shots at several ships, while the US military intercepted an Iranian cargo vessel. Data from ship-tracking services revealed only one ship leaving and two entering the Gulf within a 12-hour period—a stark contrast to the usual daily movement of about 130 vessels, as reported by Reuters.
Reuters, referencing analysis from Citi, highlighted that if these disruptions continue for another month, global oil losses could total around 1.3 billion barrels, potentially pushing prices close to $110 per barrel by the second quarter of 2026. Bloomberg further reported that Kuwait has invoked force majeure on its oil exports due to the ongoing blockade, and Societe Generale analysts estimate that global oil demand has already dropped by roughly 3%.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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