Oil prices fell in choppy trading on Monday as investors awaited clarity on talks between the U.S. and Iran and remained cautious about sustained supply losses caused by shipping disruptions.
Brent crude futures (LCOc1) fell 64 cents, or 0.6%, to $108.39 a barrel at 1109 GMT. U.S. West Texas Intermediate (CLc1) crude futures were down 1.2%, or $1.33, at $110.21 per barrel.
Price movements in Asian trading on Monday were overshadowed by an 11% surge in WTI and an 8% rise in Brent during the previous session on Thursday - the largest absolute price increases since 2020.
The U.S. and Iran received a framework plan to end hostilities, but Iran rejected immediately reopening the Strait of Hormuz after President Donald Trump threatened to rain "hell" on Tehran if it did not reach a deal by the end of Tuesday.
Iran also said it had formulated its positions and demands in response to recent ceasefire proposals conveyed via intermediaries.
The Strait of Hormuz, which carries oil and petroleum products from Iraq, Saudi Arabia, Qatar, Kuwait and the United Arab Emirates, remains largely closed due to Iranian attacks on shipping following the outbreak of war on 28 February.
Some vessels, however - including an Omani-operated tanker, a French-owned container ship and a Japanese-owned gas carrier - have passed through the Strait of Hormuz since Thursday, according to shipping data, reflecting Iran’s policy of allowing passage to vessels from countries it considers more friendly.
"The market is trying to realise what to expect going forward. The most important headline this weekend has been that some ships passed through the Strait," said SEB Research analyst Ole Hvalbye.
Hvalbye also noted that Europe continued to lose physical barrels and refined products to Asia due to tightening market conditions.
Supply disruptions in the Middle East have prompted refiners to seek alternative crude sources, particularly physical cargoes from the U.S. and Britain’s North Sea. Spot premiums for U.S. West Texas Intermediate crude have surged to record highs amid competition between Asian and European refiners.
Indian refiners have also postponed maintenance shutdowns at their facilities to meet domestic fuel demand.
On Sunday, OPEC+, comprising members of the Organization of the Petroleum Exporting Countries and allies including Russia, agreed to a modest output increase of 206,000 barrels per day for May.
However, the decision is expected to remain largely theoretical, as several key producers in the group are unable to raise output due to the war.
Saudi Arabia also set the official selling price of its May Arab Light crude to Asia at a record premium of $19.50 a barrel above the Oman/Dubai average, up $17 from the previous month, according to Aramco.
Meanwhile, Russian supply has recently been disrupted by Ukrainian drone attacks on export terminals in the Baltic Sea. Media reports on Sunday said the Ust-Luga terminal resumed loadings on Saturday after several days of disruption.
Exports from the Black Sea port of Tuapse are expected to rise to 794,000 metric tonnes in April, up 8.7% on a daily basis from 755,000 metric tonnes planned for March, according to two traders and Reuters calculations.
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The Strait of Hormuz has reopened, Iran’s Foreign Minister Abbas Araghchi and U.S. President Donald Trump said on Friday (17 April), although Washington warned its naval blockade on Iran would remain until a peace deal is reached.
The current Middle East crisis has already had profound macroeconomic and energy consequences. It also reflects a broader phase of globalisation, where interdependencies can be weaponised for geopolitical purposes.
Iran has cautiously welcomed the ten-day ceasefire between Israel and Lebanon stressing that it is an integral part of Tehran’s set of its conditions for an end to the ongoing conflict with Washington.
Start your day informed with AnewZ Morning Brief. Here are the top news stories for the 17th of April, covering the latest developments you need to know.
The past 24 hours of the Russia-Ukraine war have seen a drastic escalation in both aerial bombardment and frontline losses.
Iran reopened the Strait of Hormuz to commercial shipping on Friday (17 April) for the first time since the U.S. and Israel killed Iran's ex-Supreme Leader in air strikes, triggering the Middle East conflict, at the end of February. A U.S. blockade on Iranian ports, however, remains in force.
Russia published addresses of manufacturers allegedly producing drones or components for Ukraine on Wednesday (15 April), warning European countries against plans to step up UAV supplies to Kyiv.
Netflix shares fell sharply on Friday after the streaming group issued a weaker-than-expected outlook and said chairman and co-founder Reed Hastings will step down from the board.
U.S. President Donald Trump says Israeli and Lebanese leaders have agreed to a 10-day ceasefire that includes Hezbollah, raising cautious hopes of a pause in hostilities after weeks of escalating tensions.
Iran temporarily reopened the Strait of Hormuz on Friday (17 April) following a ceasefire agreement in Lebanon, raising optimism about peace talks, but Tehran warned that it could close the crucial waterway again if the recent U.S. Navy blockade of Iranian ports continued.
Global shipping through the Strait of Hormuz has shown signs of partial recovery after Iran announced it was open to commercial vessels during a limited ceasefire, though uncertainty remains over security conditions and compliance rules.
The Strait of Hormuz has reopened, Iran’s Foreign Minister Abbas Araghchi and U.S. President Donald Trump said on Friday (17 April), although Washington warned its naval blockade on Iran would remain until a peace deal is reached.
Iran reopened the Strait of Hormuz to commercial shipping on Friday (17 April) for the first time since the U.S. and Israel killed Iran's ex-Supreme Leader in air strikes, triggering the Middle East conflict, at the end of February. A U.S. blockade on Iranian ports, however, remains in force.
Iran has cautiously welcomed the ten-day ceasefire between Israel and Lebanon stressing that it is an integral part of Tehran’s set of its conditions for an end to the ongoing conflict with Washington.
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