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EMEA Oil Update: Crude Plunges After Report Pakistan is Pushing For US-Iran Talks

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EMEA crude futures fell in after-hours trading on Friday after reports that Pakistan was seeking to facilitate talks between the US and Iran eased concerns over a prolonged escalation in Middle East tensions and potential disruptions to crude supplies.

Brent crude futures retreated by 4.6% to $96.14 per barrel, while Murban crude futures tumbled by 9.5% to $97.04/bbl.

Pakistan is reportedly exploring a resumption of stalled US-Iran negotiations to end their nearly five-month-old conflict, following a diplomatic push by China, Tehran's largest trading partner.

Though Iranian officials have maintained public defiance, Iran's Interior Minister Eskandar Momeni traveled to Islamabad this week for exploratory talks, marking his second visit in ten days.

Momeni, considered an ally of the Islamic Revolutionary Guard Corps, met with Pakistani leaders and defense chief Asim Munir during the trip.

Meanwhile, President Trump said he will soon make a decision on whether to launch a "massive attack" on Iran as the Middle East conflict has widened a new battleground in the Red Sea.

The Red Sea has become a crucial alternative export route for Saudi Arabia, allowing the Gulf state to bypass the Strait of Hormuz and continue shipping barrels a day to global customers.

On Thursday, Trump said that the US will punish Iran for any ship attacks by the Houthis, after the group targeted two Saudi Arabian vessels in the Red Sea, extending the Middle East conflict to a second major shipping chokepoint.

"If they do this again, the US will hold Iran responsible, in that the Houthis are a surrogate and/or proxy of Iran, and major military punishment will be inflicted upon Iran and, of course, the Houthis themselves," Trump said in a social media post on Truth Social.

Soojin Kim, a research analyst at MUFG, said that with both the Hormuz and the Red Sea now exposed to disruption, the market is increasingly pricing a broader logistics-driven supply shock.

The US Central Command said it had completed a 13th consecutive night of attacks on Iran, targeting Iranian military command centers, drone storage facilities, communication networks, and coastal surveillance sites to further diminish the threat Tehran poses to vessels transiting the Hormuz.

Centcom said that more than 50,000 US service members are operating across the Middle East.

Iran, in response, said it attacked US military equipment depots at Al-Adiri, known as Camp Buehring, in northern Kuwait, and the positions of US troops at Camp Arifjan and at Camp Doha, near Kuwait City.

Iran's Islamic Revolutionary Guards Corps also said they had significantly damaged a surveillance tower used by the US Fifth Fleet in Bahrain.

On the supply front, the security situation in the Hormuz has deteriorated over the past weeks, with the latest shipping data showing only six confirmed crossings on July 23, down 60% day-over-day.

MarineTraffic said that five of the six vessels followed the Iranian Unilateral Scheme, highlighting the continued concentration of traffic along that route.

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Oil & Energy

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