Oil Prices Post Dramatic Rebound As Iran Denies Trump’s Discussion Remarks

After posting a steep crash of about 15 percent on Monday following United States President Donald Trump’s announcement to halt attacks on Iranian energy infrastructure, oil prices rebounded on Tuesday as Iran denied any talks with the US.

Global benchmark Brent Crude surged over 4 percent to around $103 per barrel, while WTI Crude was up over 4.3 percent to around $92 per barrel.

The sharp decline on Monday and the rebound on Tuesday reflect the highly volatile nature of the market and geopolitical situation.

Oil prices are hovering at around 50 percent higher than pre-war levels, when the commodity was at around $65 per barrel.

The recent volatility in the oil market has arisen after US President Trump threatened Iran last week to open the Strait of Hormuz by Monday or face attacks on its energy infrastructure.

His ultimatum had come as one of his tactics to open the crucial waterway, which used to account for about 20 percent of the world’s energy trade.

Despite the stern warning, Iran had retaliated with similar warnings to the US.

As the deadline was about to end on Monday, Trump announced that he had ordered a pause on any planned strikes on Iran’s energy establishments. He said that Iran was ready to talk further, terming his discussions “well-intentioned” and “meaningful”.

However, Iran has clearly denied any diplomatic or back-channel discussions with the US.

Hopes of a truce between the warring sides have further diminished after reports that Saudi Arabia and the United Arab Emirates are going to join the war with the US.

This indicates that the war is likely to expand, with no end in sight. This is the fourth week since the commencement of the war, which has choked the Strait of Hormuz.

Even if hostilities ease, it would take months to resume normal fuel supply levels, as about 40 energy sites have been hit so far in the region, according to the International Energy Agency.