Oil prices rise as investors doubt breakthrough in US-Iran peace talks
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
SINGAPORE: Oil prices climbed on Friday (May 22) as investors doubted the prospects of a breakthrough in United States-Iran peace talks, but held on track for a weekly loss.
Brent crude futures were up US$3.30, or 3,2 per cent, at US$105.88 a barrel by 8.45am GMT (4.05pm, Singapore time), while US West Texas Intermediate (WTI) futures were US$2.53, or 2.6 per cent, higher at US$98.88.
On a weekly basis, Brent was over 3 per cent lower, and WTI was down around 6 per cent, with prices fluctuating sharply as expectations for a peace deal shifted.
A senior Iranian source told Reuters gaps with the US have narrowed and US Secretary of State Marco Rubio spoke of "some good signs" in talks, but the countries are still divided on Tehran's uranium stockpile and controls on the Strait of Hormuz.
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
This service is not intended for persons residing in the E.U. By clicking subscribe, I agree to receive news updates and promotional material from Mediacorp and Mediacorp’s partners.
Loading
"Oil prices would only trend lower when oil market fundamentals materially improve, which looks destined to stretch into 2027," said David Oxley, chief commodities economist at Capital Economics.
Six weeks since a fragile ceasefire took effect, efforts to end the war have shown little progress, while elevated oil prices have fuelled concern over inflation and the outlook for the global economy.
"WTI is likely to remain in a US$90 to US$110 range next week, as it has largely done since late March," said Satoru Yoshida, a commodity analyst with Rakuten Securities.
BMI, a unit of Fitch Solutions, raised its average 2026 dated Brent price forecast to US$90 from US$81.50 to reflect the supply deficit, time required to repair damaged Middle East energy infrastructure and the six-to-eight week post-conflict normalisation window.
Around 20 per cent of global energy supplies transited the strait before the war, which has removed 14 million barrels per day of oil - or 14 per cent of global supply - from the market, including exports from Saudi Arabia, Iraq, the United Arab Emirates and Kuwait.
Full oil flows through the strait will not return before the first or second quarter of 2027, even if the conflict ended now, the head of the UAE's state oil firm ADNOC said.
Seven leading OPEC+ oil-producing countries will likely agree to a modest hike to July output when they meet on Jun 7, four sources said, though delivery for several remains disrupted by the Iran war.
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app