-- Crude prices slipped on Tuesday as markets weighed the possibility of US-Iran peace talks in Islamabad against a looming Wednesday ceasefire deadline.
Front-month West Texas Intermediate crude futures eased by 0.6% to $89.08 per barrel, while Brent futures fell 0.7% to $94.78/bbl.
"Oil prices slipped after a relatively quiet, range-bound Monday, with softer price action today driven by news that Iran may attend negotiations but only if the US blockade is being lifted," Saxo Bank analysts said.
However, with President Donald Trump ruling out a ceasefire extension beyond Wednesday evening, oil prices remain trapped between hope for a deal and the threat of renewed escalation.
Trump reportedly stated it is highly unlikely he will extend the ceasefire without a signed deal, reiterating that the US naval blockade of the Strait of Hormuz will remain in force until Iran agrees to a final settlement.
As of Tuesday morning, shipping activity through the Strait of Hormuz remains severely limited.
"The limited number of vessels managing to transit has done little to ease the ongoing tightening of the global energy market, which is increasingly short of prompt supplies - supporting elevated prices across diesel, jet fuel, fertilisers, and other key commodities," Saxo Bank analysts said.
While Iran briefly declared the corridor open on Friday, the weekend seizure of an Iranian vessel by the US, led Tehran to reimpose restrictions.