Oil prices rise as traders eye fragile US-Iran ceasefire
Rising Oil Prices Amid Uncertainty Over US-Iran Ceasefire
Global oil prices climbed during early Asian trading sessions on Thursday, driven by market observers closely monitoring the stability of the US-Iran ceasefire. The agreement, which includes the reopening of the critical Strait of Hormuz, faces scrutiny after Israel intensified attacks on Lebanon, prompting Iran to signal potential retaliation.
Wednesday saw a sharp decline in oil prices following the announcement of the two-week conditional ceasefire. This came after Iran threatened to block traffic through the Strait of Hormuz, disrupting maritime flow in response to US-Israeli airstrikes. The waterway, vital for global shipping, remains a focal point of tension.
“A whole civilisation will die tonight,” warned US President Donald Trump as he set a 20:00 EDT deadline for a deal. The ceasefire was brokered on Tuesday evening Washington time, just before the looming deadline.
Key terms of the agreement include allowing safe passage for ships through the Strait of Hormuz. However, Iran’s navy has issued warnings that vessels crossing without permission will face attacks. These alerts, confirmed by shipping firm SSY, have kept traffic levels low since the deal was announced.
Only a few ships have traversed the strait since the agreement took effect, far below the typical daily transit of around 130 vessels. According to Pole Star Global, clearing the backlog will require at least ten days, even if shipping resumes to normal levels.
Disputes persist over Lebanon’s involvement in the ceasefire. On Wednesday, Israel launched its most intense bombardment of the country, killing at least 182 individuals. In response, Hezbollah fired rockets at northern Israel, claiming the strikes were a reaction to alleged ceasefire breaches.
US Vice President JD Vance is set to join talks with Iran in Pakistan on Saturday, aiming to solidify the fragile agreement. The outcome of these discussions will likely influence global energy markets in the coming days.
