Global oil prices edged higher on Tuesday as uncertainty surrounding negotiations between the United States and Iran continued to fuel concerns over energy supply disruptions.
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Brent crude futures rose 30 cents, or 0.29 per cent, to $104.51 per barrel in early Asian trading, while US West Texas Intermediate crude climbed 31 cents, or 0.32pc, to $98.38 per barrel. Both benchmarks had already gained nearly 2.8pc in the previous session.
Market sentiment remained cautious after US President Donald Trump said a ceasefire with Iran was “on life support,” citing major disagreements between the two sides over conditions for de-escalation.
Iran’s latest response to a US proposal reportedly included demands for an end to hostilities, removal of the US naval blockade, restoration of Iranian oil exports and compensation for wartime damages.
Tehran has also stressed sovereignty over the Strait of Hormuz, a critical shipping route through which roughly one-fifth of global oil and liquefied natural gas passes. Continued uncertainty over access to the strait has heightened fears of supply shortages and price volatility.
Analysts say oil prices are likely to remain elevated while negotiations remain unresolved and physical oil flows through the Strait of Hormuz face restrictions.
A Reuters survey also showed that OPEC oil production in April fell to its lowest level in more than two decades, partly due to export disruptions linked to the regional conflict.
Meanwhile, the Trump administration announced plans to loan 53.3 million barrels of crude oil from the US Strategic Petroleum Reserve in an effort to stabilise markets and ease supply concerns.
Ship-tracking data indicated that one SPR crude shipment is already en route to Turkey, marking the first such delivery to the Mediterranean country.
Additional geopolitical pressure emerged after Washington imposed sanctions on individuals and companies accused of facilitating Iranian oil exports to China.
Read More: Oil prices hit four-year high amid Hormuz tensions
The prolonged instability has reinforced concerns about global energy security, with analysts warning that further escalation or renewed threats to shipping routes could push oil prices even higher in the coming weeks.