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EMEA Oil Update: Crude Prices Ease as Markets Remain on Edge

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Global oil prices held tight to most of Monday's 5% rally, adopting a cautious stance despite US President Donald Trump's expression of optimism for a deal with Iran.

Front-month Murban crude futures eased 0.1% to $94.33 per barrel, while Brent futures were down 1.2% to $93.86/bbl.

"Crude oil continues to trade from one headline to the next, making it increasingly difficult for traders to maintain conviction beyond a few hours," Saxo Bank analysts said.

The minor pullback reflects a cautious wait-and-see approach from investors after US President Donald Trump reiterated in a social media post that "it will all work out well in the end."

Market sentiment does not share the same apparent confidence however. Iran reportedly said on Monday that it was suspending indirect negotiations with Washington.

Compounding the diplomatic gridlock, Iranian state media reported that Tehran is now aiming for a complete blockade of the critical Strait of Hormuz that would halt the small trickle of ships that are managing to cross it.

The threat to global oil flows is expanding beyond Hormuz. Iran's proxy militant groups are reportedly considering closing the Bab el-Mandeb Strait at the southern end of the Red Sea.

This development is particularly alarming for energy markets, as the Bab el-Mandeb has served as a vital alternative route for Saudi Arabia to bypass the already-closed Strait of Hormuz.

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