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EMEA Oil Update: Crude Mixed as US-Iran Deal Optimism Temper Supply Fears

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EMEA crude futures diverged in after-hours trading on Thursday, trimming earlier gains, as renewed optimism over a potential US-Iran peace deal helped offset geopolitical risk premiums tied to Middle East supply concerns.

Brent crude futures slipped 0.51% to $93.81 per barrel, while Murban oil futures climbed 3.76% to $93.31/bbl. Prices rallied earlier Thursday after the US and Iran exchanged military strikes.

"The market remains caught between pricing the prospect of a deal and the growing realization that a resolution still looks increasingly elusive," Saxo Bank strategists said on Thursday.

US and Iran negotiators have reportedly reached a tentative agreement for a 60-day ceasefire extension and the start of talks on Tehran's nuclear program. However, the agreement between the US and Iran still needs final approval from President Trump, who has told mediators he wants a few days to make the final decision.

The tentative agreement comes at a moment when the fragile ceasefire between the US and Iran appeared to be wavering.

On Thursday, Iran's Revolutionary Guard targeted a US air base in Kuwait with ballistic missiles, which the US Central Command said were successfully intercepted.

The attack came after US forces launched fresh strikes in Iran against a military site believed to threaten American troops and commercial shipping through the Strait of Hormuz.

Saxo Bank analysts said Brent crude surged on Wednesday after renewed US attacks near the Hormuz and retaliatory IRGC strikes targeting US bases, underscoring the limited prospect for a near-term peace deal as the two sides remained far apart on steps needed to reopen the Strait.

On Wednesday, the US Treasury Department sanctioned Iran's Persian Gulf Strait Authority, accusing the agency of extorting commercial vessels in the strategic waterway to fund the Islamic Revolutionary Guard.

"The Iranian military's latest attempt to extort global maritime trade is proof that Economic Fury has left the regime desperate for cash," Treasury Secretary Scott Bessent said.

Secretary Bessent separately warned Oman against collaborating with Iran over a tolling mechanism.

"Oman, in particular, should know that the US Treasury will aggressively target any actors involved - directly or indirectly - in facilitating tolls for the Strait and any willing partners will be penalized," he said.

Meanwhile, the latest diplomatic developments and sanctions came as the US increased pressure on Iran with its naval blockade to choke off Iranian oil revenues. The US military has redirected 111 Iran-linked commercial vessels and disabled four others since imposing the blockade on April 13, the CENTCOM said on Thursday.

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Update: US, Iran Reach Tentative 60-Day Nuclear Talks Deal Pending Trump Approval

(Updates to include White House response in the 2nd paragraph.)US and Iranian negotiators have tentatively agreed to a 60-day memorandum of understanding to extend the ceasefire and begin talks on Iran's nuclear program, pending President Donald Trump's final approval, Axios reported, citing two US officials and a regional source involved in the mediation.The White House confirmed the development toin an emailed response, citing US officials.The proposed deal could be announced as early as Sunday, according to the report, although officials cautioned it has not been finalized and could still collapse."This is an agreement to get everybody to the table. We will work out the details in the negotiations," one US official reportedly said.According to Axios, Iranian representatives told mediators they had secured the necessary approvals and were prepared to sign the agreement, though Tehran has not publicly confirmed that claim.Trump was briefed on the proposal but withheld immediate approval. "The president relayed to the mediators that he wants a couple of days to think about it," a US official said.Under the draft memorandum, shipping through the Strait of Hormuz would remain "unrestricted," officials said. Iran would remove naval mines from the waterway within 30 days and halt interference with commercial shipping. In return, the US would gradually lift its naval blockade and issue sanctions waivers allowing Iran to resume oil exports.The agreement would also include an Iranian commitment not to pursue a nuclear weapon and launch a 60-day negotiation period focused on Iran's highly enriched uranium stockpile and uranium enrichment activities.Washington would discuss sanctions relief and the release of frozen Iranian funds as part of the talks, while humanitarian aid and commercial goods deliveries to Iran would also be addressed.The draft memorandum also states that the conflict between Israel and Hezbollah in Lebanon would end. Israeli Prime Minister Benjamin Netanyahu raised concerns about that provision and other aspects of the deal during a phone call with Trump on Saturday, Axios said, citing Israeli and US officialsThe White House, the Iranian Foreign Ministry, the Permanent Mission of Iran to the UN, and the Israeli Prime Minister's Office did not immediately respond torequests for comment.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

Oil & Energy

Update: US Sanctions Iranian Maritime Agency Over Alleged Hormuz Extortion Scheme

(Updates with additional comments by Bessent in paragraphs 9-13.)The US Treasury Department on Wednesday sanctioned Iran's Persian Gulf Strait Authority, alleging that the agency extorted commercial vessels in the Strait of Hormuz to fund the Islamic Revolutionary Guard."The Iranian military's latest attempt to extort global maritime trade is proof that Economic Fury has left the regime desperate for cash," Treasury Secretary Scott Bessent said in a statement.The sanctions target the PGSA and any person or entity cooperating with the agency, which was established earlier in May to approve transit through the Hormuz and charge tolls that could reportedly reach as high as $2 million per vessel.Treasury said vessels transiting the strait had been required to submit information to the PGSA and follow Iranian-designated navigation routes near Iran's coastline in exchange for what Tehran described as permission for safe passage.The sanctions form part of the Trump administration's broader "Economic Fury" campaign aimed at intensifying economic pressure on Iran and curbing its oil revenues."Forming a Wall of Steel, the US Naval blockade has ensured a record low amount of Iranian crude on the water. We will also be shutting down both Iranian airlines' access to landing spots, refueling, and ticket sales," Secretary Bessent said on X.Treasury also warned shipping companies, insurers, and financial institutions that they could face sanctions exposure if they comply with Iranian demands related to transit payments through the Strait.The Department said prohibited payments could include transfers in traditional currencies, digital assets, informal swaps or other in-kind arrangements.Separately, Bessent said the Trump administration will not "tolerate" actions implementing a tolling system in the Strait of Hormuz."The United States Government will not tolerate any effort to impose a tolling system in the Strait of Hormuz," Bessent said in an X post.Bessent went on to warn Oman against collaborating with Iran over a tolling mechanism."Oman, in particular, should know that the US Treasury will aggressively target any actors involved - directly or indirectly - in facilitating tolls for the Strait and any willing partners will be penalized," Bessent said.He urged all nations "should reject outright any efforts by Iran to disrupt the free flow of commerce."Bessent's warning to Oman comes a day after President Donald Trump warned Oman of military consequences if it joined forces with Iran to set up a tolling system in the strategic waterway.

Oil & Energy

Market Chatter: US, Iran Reach Tentative 60-Day Nuclear Talks Deal Pending Trump Approval

US and Iranian negotiators have tentatively agreed to a 60-day memorandum of understanding to extend the ceasefire and begin talks on Iran's nuclear program, pending President Donald Trump's final approval, Axios reported, citing two US officials and a regional source involved in the mediation.The proposed deal could be announced as early as Sunday, according to the report, although officials cautioned it has not been finalized and could still collapse."This is an agreement to get everybody to the table. We will work out the details in the negotiations," one US official reportedly said.According to Axios, Iranian representatives told mediators they had secured the necessary approvals and were prepared to sign the agreement, though Tehran has not publicly confirmed that claim.Trump was briefed on the proposal but withheld immediate approval. "The president relayed to the mediators that he wants a couple of days to think about it," a US official said.Under the draft memorandum, shipping through the Strait of Hormuz would remain "unrestricted," officials said. Iran would remove naval mines from the waterway within 30 days and halt interference with commercial shipping. In return, the US would gradually lift its naval blockade and issue sanctions waivers allowing Iran to resume oil exports.The agreement would also include an Iranian commitment not to pursue a nuclear weapon and launch a 60-day negotiation period focused on Iran's highly enriched uranium stockpile and uranium enrichment activities.Washington would discuss sanctions relief and the release of frozen Iranian funds as part of the talks, while humanitarian aid and commercial goods deliveries to Iran would also be addressed.The draft memorandum also states that the conflict between Israel and Hezbollah in Lebanon would end. Israeli Prime Minister Benjamin Netanyahu raised concerns about that provision and other aspects of the deal during a phone call with Trump on Saturday, Axios said, citing Israeli and US officialsThe White House, the Iranian Foreign Ministry, the Permanent Mission of Iran to the UN, and the Israeli Prime Minister's Office did not immediately respond torequests for comment.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)