Oil & Energy
US Oil Update: Futures Rally as Trump Rejects Iran Ceasefire Extension
Crude oil futures rallied in midday trading on Tuesday after President Trump said Iran violated the two-week ceasefire numerous times and he did not want to extend the soon-to-expire truce as the US military is preparing for action if the negotiations fail.Front-month West Texas Intermediate crude futures jumped by 2.89% to $92.20 per barrel, while Brent futures rose 3.03% to $98.26/bbl.Dan Bunkering strategists said in a note on Tuesday that the crude market has been heavily driven by news flow, and this is expected to remain the case in the coming week.US Vice President J D Vance's planned trip to Islamabad, Pakistan's capital, for peace talks with Iran to end the Middle East conflict has reportedly been put on hold after Tehran failed to respond to US negotiating positions."Formal response from Iranian side about confirmation of delegation to attend Islamabad Peace Talks is still awaited," Pakistan's information minister, Attaullah Tarar, said in a post on X. "Pakistan as the mediator is in constant touch with Iranians and pursuing the path of diplomacy and dialogue".Trump ruled out extending the soon-to-expire ceasefire, stoking fears of a direct military escalation and renewed disruptions to global energy flows through the Strait of Hormuz.Iranian officials, including the Speaker of parliament, Mohammad Bagher Ghalibaf, have not publicly committed to participating in the talks. "We do not accept negotiations under the shadow of threat, and over the past two weeks we have prepared to reveal new cards on the battlefield," Ghalibaf said in a social media post on X.The Department of War, previously the Department of Defense, also said the US forces stopped and boarded a sanctioned oil tanker in its campaign to disrupt Iran's shipping network."US forces have boarded the crude oil tanker Tifani in the Indian Ocean, in what appears to be a further escalation in enforcement against Iran-linked shipping," MarineTraffic said in a social media post on X.The shipping data firm said the 330-meter VLCC was reportedly carrying around 2 million barrels of crude loaded at Kharg Island earlier in April.Three vessels, two cargo ships and a fuel tanker, crossed the Strait of Hormuz on Tuesday as US and Iranian blockades remained in place, according to media reports.Saxo Bank strategists said on Tuesday that the limited number of vessels that have managed to transit the Hormuz has done little to ease the ongoing tightening of the global energy market, which is increasingly short of prompt supplies.Meanwhile, US Energy Secretary Chris Wright said during a testimony before a Senate panel on Tuesday that US gasoline prices likely peaked last week.