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US Oil Update: Futures Hold Gains as Trump Says US-Iran Talks Continue

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Crude futures climbed in midday trading on Tuesday after President Trump said talks with Iran were ongoing despite conflicting signals from Tehran.

Front-month West Texas Intermediate crude futures advanced by 1.56% to $91.88 per barrel, and Brent futures were up 1.13% to $96.03/bbl.

Soojin Kim, research analyst at MUFG, said oil held gains as uncertainty surrounding US-Iran negotiations raised concerns that disruptions to energy flows from the Persian Gulf could persist.

Trump said on Tuesday that reports suggesting that the US and Iran had stopped communicating are "fake and erroneous," adding that talks between Washington and Tehran have continued over recent days.

The US President said that while the direction of the talks remains uncertain, he has told Iran it is "time, one way or another, to make a deal," arguing that the current situation cannot continue indefinitely.

"The conversations between us have been going on continuously...," Trump said in a social media post on Trust Social.

Iran, meanwhile, suspended the exchange of messages with US negotiators for at least several days, according to local reports, and issued threats against vessels transiting the Bab el Mandeb, the Red Sea chokepoint that carries a major share of the world's energy shipments.

ING strategists said any disruptions to southbound flows from the Red Sea would require vessels to travel north through the Suez Canal and around the Cape of Good Hope.

Fueling uncertainty, Trump and Prime Minister Benjamin Netanyahu offered conflicting accounts of a call about the ongoing war between Israel and Hezbollah.

On Monday, Trump said he held a call with Prime Minister Netanyahu during which he instructed Israel to halt a planned strike on parts of Beirut, as regional tensions escalated amid continued cross-border violence.

Netanyahu, in a separate statement, said he told the US President that Israel would target locations in Beirut if Hezbollah did not stop attacks against Israel, following ongoing exchanges of fire in southern Lebanon.

Saxo Bank strategists said global energy markets are continuing to tighten, with the main focus remaining on the Strait of Hormuz, amid growing concerns about supply disruptions and elevated energy prices.

The Hormuz remains effectively blocked more than three months after the US-Israel alliance launched strikes against Iran. Traffic via the strategic waterway remains constrained, with the US Central Command saying on Monday that US forces redirected 122 Iran-linked commercial vessels.

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