MARKET NEWS
Oil Slips as Iran Set to Attend Negotiations With US in Pakistan - BLOOMBERG
(Bloomberg) -- Oil slipped on signs that Iran will attend negotiations with the US in Islamabad before a ceasefire between the sides ends.
Brent dropped as much as 1.1% to $94.44 a barrel after gaining 5.6% on Monday. Iran is sending a team to the Pakistani capital, according to people familiar with the plans who declined to be identified, although it is not clear who would lead the delegation. Earlier, Tehran had said it was hesitant to participate in further peace talks with the US.
Vice President JD Vance is leaving later on Monday to resume negotiations, “either Tuesday night or Wednesday morning,” Donald Trump said in a phone interview on Monday. The US president said it’s “highly unlikely” that he’d extend the truce, which expires on “Wednesday evening Washington time.”
Oil prices have been buffeted in recent days amid rapidly shifting perceptions of the negotiations’ status and whether ships can navigate the Strait of Hormuz — the waterway through which about a fifth of the world’s crude normally transits. The standoff over Hormuz threatens to deepen the global energy crisis and is just one of the unresolved issues between Iran and the US, which also include the Islamic Republic’s nuclear capabilities and Israel’s invasion of Lebanon.
“Either we move toward some form of de-escalation or this drags into a more prolonged disruption, especially around energy supply,” said Dilin Wu, a research strategist at Pepperstone Group. “The market will be super sensitive to any headline updates in the next 24 hours.”
Monday’s session saw conflicting statements from Trump about the timing and viability of peace talks. Oil extended gains after he said that the US would continue to block the strait for Iran-linked ships until an agreement is finalized.
Meanwhile, Hormuz flows remain at a virtual standstill, with three vessels attempting to transit early Tuesday. The crisis flared again over the weekend after the US Navy seized an Iranian vessel while the Islamic Republic’s forces fired at ships and reimposed controls across the strait.
On Monday, Chinese President Xi Jinping called for an immediate ceasefire and the restoration of normal transit through the waterway, according to a Foreign Ministry read-out of a phone call with Saudi Crown Prince Mohammed bin Salman.
