Trump’s confirmation of talks with Iran alongside ongoing military strikes maintains geopolitical risk premium in oil markets.
US President Donald Trump confirmed Tuesday that Washington held talks with Iran while continuing military strikes, signaling no imminent de-escalation. His remarks reinforced the geopolitical risk premium in crude and diesel prices, already elevated due to recent supply concerns in the Hormuz region.
Trump stated that Iranian energy infrastructure remains untouched for now, preserving a potential escalation option. Markets are likely to remain sensitive to shifts in rhetoric around energy targets, given their direct impact on physical oil supply. The mixed signals—military pressure alongside diplomatic outreach—add uncertainty to near-term price movements.
Oil traders are pricing in tail risk to regional supply, with no clear resolution in sight. The disclosure of talks introduces a competing narrative but does not reduce the perceived threat to energy flows.