Oil Prices Surge as US–Iran Talks Stall and Strait of Hormuz Disruptions Continue
Tehran: Global oil prices have surged sharply amid stalled peace talks between the United States and Iran and ongoing disruptions to shipments through the Strait of Hormuz, a critical route for global energy supplies.
Benchmark Brent crude rose by $3.16 (3%) to $108.50 per barrel, marking its biggest single-day gain in three weeks. Meanwhile, West Texas Intermediate (WTI) increased by $1.87 (2%) to $96.27. Over the past week, Brent and WTI have climbed 17% and 13%, respectively—their largest weekly gains since the onset of the conflict.
Analysts attribute the surge primarily to supply constraints, with an estimated 10–13 million barrels per day failing to reach global markets. Iran’s restrictions on the Strait of Hormuz, following renewed U.S. sanctions on its ports, have significantly reduced tanker traffic. Shipping data indicates that only a limited number of vessels have entered the Gulf in recent days.
Adding to market volatility, Goldman Sachs revised its outlook, citing reduced Middle East production, while industry experts warn that prolonged disruptions could tighten supply further.
Diplomatic efforts to ease tensions remain uncertain. Iran has reportedly indicated—through mediation by Pakistan—its willingness to reopen the Strait without a comprehensive nuclear agreement, provided the United States lifts sanctions and ends hostilities. However, U.S. President Donald Trump has maintained that any lasting deal must include Iran fully abandoning its nuclear programme, a condition Tehran continues to reject, insisting its activities are peaceful.
Negotiations held earlier this month in Islamabad failed to produce a breakthrough, largely due to disagreements over nuclear disarmament and control of the strategic waterway.
Meanwhile, Iranian Foreign Minister Abbas Araghchi has stepped up diplomatic engagements, visiting Russia, Oman, and other regional players in an effort to revive talks. In St. Petersburg, he held discussions with Russian President Vladimir Putin, who reiterated Moscow’s support for diplomatic efforts to stabilise the region.
The crisis has already had broader economic repercussions, with rising energy costs feeding into higher prices for food, fertilisers, and other essential goods worldwide. Political pressure is also mounting on Washington, as sustained price increases threaten to impact domestic economic stability ahead of key elections.
While Iran has proposed delaying nuclear negotiations in favour of immediate de-escalation measures, it remains unclear whether the United States will accept such terms. Until a resolution is reached, uncertainty in global energy markets is expected to persist.
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