Oil prices surged after Iran denied having had contact with the U.S.
Global oil prices surged sharply after Iran officially denied any contact with the United States. The market, which had begun to price in a de-escalation in the Persian Gulf the day before, reacted immediately with a rise in prices.
This was reported by Reuters.
As of the morning of March 24, prices for the benchmark Brent and West Texas Intermediate grades had recovered a significant portion of yesterday’s decline. The reason was a statement from the Iranian Ministry of Foreign Affairs, which called the White House’s claims of “productive talks” a psychological operation and manipulation.
“Brent futures rose by $4, or 4%, to $103.94 per barrel, while U.S. West Texas Intermediate crude rose by $3.49, or 4%, to $91.62,” analysts report.
The day before, the oil market had plummeted by nearly 11% after Donald Trump announced Iran’s readiness for dialogue and his decision to postpone military strikes on the country’s energy facilities for five days. Investors had been counting on the opening of the Strait of Hormuz, which remains blocked by Iranian forces.
“By postponing the plan to strike Iranian power plants for five days, the U.S. has effectively removed a significant portion of the ‘military premium’ from oil prices. Today’s moderate rebound is merely an attempt by the market to find a foothold in an unstable situation,” noted Tim Waterer, chief market analyst at KCM Trade.
Prior to this, oil prices had plummeted after Donald Trump announced a possible de-escalation in the Middle East and the imminent end of the war with Iran. The market partially retraced its three-year high, while Brent and WTI fell by 4% or more. Investors calmed down following reports of stable supplies and the possible use of strategic oil reserves.
