Oil Prices Jump Again: Iran Denies US Talks, Supply Fears Shake Global Markets

Global oil markets are once again on edge. After a brief cooling, crude prices have resumed their upward march as fresh geopolitical signals from West Asia reignite concerns over supply disruptions.

The latest trigger came after Iran denied holding talks with the United States to de-escalate the conflict in the Gulf, contradicting earlier remarks by US President Donald Trump that suggested a possible breakthrough.

Markets React To Conflicting Signals

According to a Reuters report, oil prices rose sharply in early trade as uncertainty returned to the market. Brent crude futures climbed $4, or 4 per cent, to $103.94 per barrel, while US West Texas Intermediate (WTI) gained $3.49, or 4 per cent, to $91.62.

This rebound followed a volatile previous session, where crude prices had dropped more than 10 per cent. The decline came after Trump announced a five-day pause on planned strikes on Iranian power plants, claiming that talks with unnamed Iranian officials had yielded “major points of agreement”.

However, Tehran swiftly dismissed these claims. Iranian authorities rejected the suggestion of negotiations, calling it an attempt to influence financial markets. The country’s Revolutionary Guards also said they had targeted US-linked assets and described Trump’s remarks as “worn-out psychological operations”.

Strait Of Hormuz Remains The Key Concern

At the centre of the volatility is the Strait of Hormuz, a critical chokepoint for global energy flows. Nearly one-fifth of the world’s oil and liquefied natural gas passes through this narrow corridor.

The ongoing conflict has severely disrupted shipments through the strait, effectively halting a large portion of global energy movement. While there were signs of limited activity, with two tankers bound for India managing to pass through on Monday, the route remains far from fully operational.

Tim Waterer, chief market analyst at KCM Trade, noted that while the temporary pause in military action had briefly eased prices, underlying risks remain.

“By shelving the plan to strike Iranian power plants for five days, the US effectively sucked much of the 'war premium' from the oil price,” he said.

“Today's moderate bounce is just the market finding its footing in the mud. Traders are aware that while the missiles are on hold, the Strait of Hormuz is still far from a clear waterway.”

Supply Risks Keep Prices Elevated

Analysts believe that despite short-term fluctuations, the broader trend for oil prices remains upward due to persistent supply concerns.

Macquarie, in a client note cited by Reuters, said that even if tensions ease slightly, oil prices are likely to remain supported.

“Even with a possible decrease in tensions after (Monday's) announcement from President Trump, we expect a price floor of $85-$90 and a natural drift back to the $110 range until the Strait of Hormuz is restored,” the note said.

The brokerage also warned that if disruptions continue until the end of April, Brent crude could surge to as high as $150 per barrel.

Energy Infrastructure Under Attack

Beyond shipping disruptions, damage to critical energy infrastructure is compounding the crisis.

According to reports, a gas company office and a pressure-reduction station were hit in Isfahan, while a projectile struck a pipeline supplying a power station in Khorramshahr.

Such incidents raise concerns about prolonged outages and delayed recovery in supply, which could keep markets volatile for an extended period.

Efforts To Ease Supply Tightness

In response to tightening supply, the United States has taken steps to stabilise the market. Washington has temporarily waived sanctions on Russian and Iranian oil already at sea, allowing additional barrels to enter the system.

Industry sources told Reuters that traders have begun offering Iranian crude to Indian refiners at a premium to ICE Brent, reflecting the urgency and scarcity in the market.

Meanwhile, the International Energy Agency (IEA) is in discussions with governments across Asia and Europe on potential coordinated releases from strategic reserves if required.

IEA Executive Director Fatih Birol said the agency is consulting stakeholders on possible action “if necessary” to prevent further supply shocks.

For now, oil markets remain caught between hope and uncertainty, hope for de-escalation and restored supply, and uncertainty driven by conflicting signals and ongoing geopolitical risks.