Crude oil prices moved higher on Wednesday, extending gains from the previous session as investors reacted to renewed geopolitical tensions in the Middle East and uncertainty surrounding ongoing Iran-US negotiations. Concerns over supply disruptions through key energy routes also supported market sentiment.
Brent crude futures rose $1.23, or 1.28%, to trade at $97.00 per barrel, while US West Texas Intermediate (WTI) crude futures gained $1.10, or 1.17%, to $94.86 per barrel. Both benchmarks had settled at their highest levels in a week during the previous trading session.
Oil markets received fresh support after Iran reportedly launched ballistic missiles towards Kuwait and Bahrain. According to the US military, the missiles failed to hit their intended targets, prompting retaliatory strikes by US forces on Iran’s Qeshm Island.
The latest escalation has heightened concerns over regional stability and the potential impact on global oil supplies. Investors continue to monitor developments closely as tensions remain elevated across the Gulf region.
Market participants are also awaiting further clarity on diplomatic efforts aimed at ending the conflict. Reports suggest that Tehran is reviewing a proposed agreement with Washington designed to halt hostilities.
However, Iranian media indicated that communication between Iran and the United States has been limited in recent days. Despite this, US President Donald Trump stated that negotiations have continued without interruption.
The lack of a clear breakthrough in talks has added to market uncertainty, supporting the recent rise in crude oil prices.
The Strait of Hormuz continues to remain a critical focus for energy markets. The waterway is one of the world's most important oil transit routes, handling a significant portion of global crude exports.
According to market analysts, attempts to restore normal shipping activity face challenges as Iran has reportedly mined large sections of the route. While there has been a modest increase in vessel movements, overall transit volumes remain considerably below levels seen before the conflict.
Any prolonged disruption in the Strait of Hormuz could significantly impact global energy supply chains and keep upward pressure on crude oil prices.
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Beyond geopolitical developments, supply fundamentals have also contributed to the positive momentum in oil markets.
According to market sources citing data from the American Petroleum Institute (API), US crude oil inventories declined for the seventh consecutive week during the week ended May 29.
Crude stockpiles reportedly fell by 6.8 million barrels, indicating continued demand strength and tighter supply conditions. Investors are now awaiting official inventory figures from the US government for further confirmation of the trend.
WTI crude futures for July 2026 were trading at $94.86 per barrel, with an intraday range of $93.64 to $96.04. The benchmark has traded within a 52-week range of $54.98 to $117.63.
Brent crude futures for August 2026 were trading at $97.00 per barrel, with prices moving between $95.76 and $97.24 during the session. Brent's 52-week range stands between $58.72 and $126.41.
Crude oil prices remain firmly supported by escalating geopolitical tensions, uncertainty surrounding Iran-US negotiations and concerns over shipping activity through the Strait of Hormuz. Combined with falling US crude inventories, these factors are likely to keep oil markets volatile in the near term as investors await further developments on both the diplomatic and supply fronts.
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Published on: Jun 3, 2026, 8:35 AM IST
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