-- Crude oil futures climbed in after-hours trading on Tuesday, buoyed by reports that President Trump is dissatisfied with Iran's latest proposal to end the Middle East conflict and reopen the Strait of Hormuz, as markets weigh the UAE's decision to exit OPEC.
Front-month West Texas Intermediate crude futures gained 3.37% to $99.62 per barrel, while Brent futures were up 2.66% to $111.11/bbl.
Soojin Kim, research analyst at MUFG, said crude edged higher as markets assessed Iran's latest proposal to revive peace talks, while disruptions in the Hormuz continued to constrain global energy supplies.
President Trump reportedly told his advisors that he is not satisfied with Iran's proposal to open the Strait and end the Middle East conflict, which has roiled the global energy market. However, it was not yet clear why Trump is dissatisfied with Iran's offer.
The US President said in a social media post on Tuesday that Iran wants the US to lift its blockade of the Hormuz and reopen the strategic waterway as soon as possible.
Saxo Bank strategists said that US-Iran peace talks remain at an impasse, with efforts to restart negotiations stalled.
Iran, on the other hand, has signaled it may be willing to accept an interim deal to reopen the Strait in exchange for an end to the blockade, according to media reports.
The double blockade of the Strait by the US and Iran has ground vessel traffic to near zero, choking off flows of crude, natural gas and oil products.
Iran's mission to the UN accused the US of unlawful actions that threaten international navigation, saying that any disruption to vessel traffic in the Hormuz would be the US's responsibility.
Kim said Iran has reportedly tied a broader peace deal to the removal of the US naval blockade and guarantees against future attacks, but the US remains skeptical.
Meanwhile, the UAE's departure from the OPEC+ alliance is set to have major ripple effects on the global oil market, especially if major producers like Saudi Arabia and Russia also increase output.
Rystad Energy strategies said the UAE's departure strips the producer group of one of its core mechanisms of influence, spare capacity that can be deployed to offset disruptions or withdrawn to support prices.
However, Sparta Commodities analysts said that though the producer cartel is facing renewed questions over its long-term cohesion after the departure, the immediate impact on global oil balances remains muted.
On the supply front, Iran is reportedly running out of storage capacity for its crude, raising the prospect that it may be forced to cut output further. US Treasury Secretary Scott Bessent said in a social media post on Monday that the Iranian oil industry was "starting to shut in production" due to the Hormuz blockade.