Oil prices retreat slightly after Tehran hints at backchannel talks despite ongoing Middle East tensions and supply risks.
West Texas Intermediate crude fell 0.54% to $81.30 on Monday as investors locked in gains following a weeks-long rally. The pullback comes despite persistent geopolitical risks, particularly around the Strait of Hormuz, a critical chokepoint for global oil shipments.
Recent U.S. military strikes on Iranian targets and Tehran’s hardline stance on the waterway had fueled supply disruption fears. However, Iran’s Foreign Ministry confirmed diplomatic intermediaries have exchanged messages in recent days, easing some concerns. Analysts warn the market remains vulnerable to further shocks.
ING analysts noted tanker traffic through the Strait faces ongoing disruptions, keeping supply risks elevated. The balance between military posturing and diplomatic efforts continues to drive volatility in oil markets.