Oil Prices edged lower on Tuesday as investors weighed reports of renewed diplomatic efforts between the United States and Iran against fresh military exchanges and growing concerns over global energy supplies.
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Brent crude futures fell 35 cents, or 0.4%, to $88.87 per barrel by 0052 GMT. Meanwhile, U.S. West Texas Intermediate (WTI) crude for September delivery traded little changed at $82.47 per barrel. Both benchmarks remained below the one-month highs reached in the previous session.
Market sentiment remained cautious after Yemen’s Iran-aligned Houthi movement threatened to impose a naval blockade on Saudi Arabia. The move raised concerns about potential disruptions to oil exports and international shipping.
Analysts said any disruption involving Saudi Arabia, one of the world’s largest oil exporters, could increase pressure on global energy markets.
At the same time, hopes for a diplomatic breakthrough limited further price gains. A senior Iranian official told Reuters that Tehran had received a proposal from international mediators for a 10-day ceasefire, aimed at preserving an interim agreement signed on June 17 and creating momentum for broader peace negotiations.
However, tensions remained high. The diplomatic initiative followed another night of U.S. airstrikes on Iranian targets and retaliatory attacks by Iran’s Revolutionary Guards on U.S. military assets across the region. Later, U.S. Central Command confirmed it had launched another wave of strikes.
Market analysts said expectations of possible de-escalation have temporarily capped oil prices, although uncertainty over the conflict continues to support the market.
Meanwhile, a preliminary Reuters survey indicated that U.S. crude oil and gasoline inventories likely declined last week, while distillate stockpiles were expected to increase.
