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EMEA Oil Update: Oil Gains After Increased Skepticism on US-Iran Peace Deal

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Crude futures recovered on Thursday after declining in the previous session, as the White House dismissed an Iranian media report of a framework peace deal between US and Iran.

The Brent futures contract gained about 2.8% to $96.88 per barrel. Murban futures closed at $89.93 on May 28 and were not trading by the time of publication of this oil price update.

A sharp selloff was triggered on Wednesday after Iranian state television broadcast a draft interim agreement.

The report claimed maritime traffic through the vital Strait of Hormuz could return to normal within a month.

However, US President Donald Trump stated that he remained unsatisfied with the negotiations aimed at ending the three-month conflict, adding that critical issues have yet to be resolved.

"Traders have become increasingly cautious about holding long exposure to the oil market ahead of headlines showing progress in ending the conflict," ANZ said.

The ongoing disruption is severely altering global trade patterns, particularly for top buyers.

Analysts from the Oxford Institute for Energy Studies noted that China has sharply reduced its crude oil imports to 9.3 million barrels per day in April down from its five-year average of roughly 11 mb/d.

Meanwhile, underlying supply indicators suggest a tightening physical market.

Data from the American Petroleum Institute revealed that US crude oil inventories fell by 2.8 million barrels for the week ended May 22, building on a massive 9.1-million-barrels draw from the prior week.

Energy markets are now awaiting official confirmation from the US Energy Information Administration's upcoming petroleum inventory report.

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US Oil Update: Futures Slide as Markets Price in Months-Long Normalization Process

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