SINGAPORE: Oil prices eased on Monday after President Donald Trump said the US would begin an effort to assist ships stranded in the Strait of Hormuz, but the lack of a US-Iran peace deal kept the market supported above $100.
Brent crude futures fell 6 cents, or 0.1 percent, to $108.11 a barrel by 07:00 a.m. Saudi time after settling down $2.23 on Friday. US West Texas Intermediate was at $101.50 a barrel, down 44 cents, or 0.4 percent, following a $3.13 loss on Friday.
“The broader market remains tightly supported by persistent supply disruptions and geopolitical uncertainty,” said Priyanka Sachdeva, analyst at Phillip Nova.
“Unless there is a clear and sustained resolution that restores normal flows through the Strait of Hormuz, oil prices are likely to remain elevated, with risks still tilted toward further upside.”
Trump said on Sunday that the US will guide ships safely out of the Strait of Hormuz, but oil prices stayed above $100 a barrel, with no peace deal in sight and shipping through the strategic waterway still constrained.
Negotiations between the US and Iran continued over the weekend with the countries assessing responses from each other.
Trump has made securing a nuclear deal with Tehran a priority, but Iran wants to defer nuclear talks until after the war and first lift rival blockades on Gulf shipping.
On Sunday, the Organization of the Petroleum Exporting Countries and their allies, or OPEC+, said they will raise oil output targets by 188,000 barrels per day in June for seven members, the third consecutive monthly rise.
The increase is the same as that agreed for May minus the share of the UAE, which left OPEC on May 1. However, the higher volume will remain largely on paper as long as the Iran war continues to disrupt Gulf oil supplies through the Strait of Hormuz.
