Brent crude pushed firmly above $105 per barrel on Tuesday, extending gains as the market reacted to the breakdown in diplomatic expectations between the United States and Iran. The move was not driven by speculation, but by a clear reassessment of risk in a market already sensitive to disruptions in the Strait of Harmuz.
At the time of writing 07:18 am (WAT), Brent crude stood at $105.60 per barrel, while West Texas Intermediate (WTI) was at $99.72 per barrel, up 1.68%. Murban crude recorded a sharper increase, rising 4.84% to $103.60, reflecting stronger pressure on medium sour grades. Natural gas also firmed slightly to $2.934, up 0.82%.
The immediate trigger is Washington’s rejection of Iran’s latest response to a proposed peace framework. That development effectively erased short-term expectations of de-escalation and pushed traders back into a risk-sensitive position. With negotiations stalling, attention has shifted back to the Strait of Hormuz and the broader security of crude shipments through the region.
Supply conditions are already tight. Recent production data from OPEC points to a decline in output, reducing the cushion available to absorb further disruptions. At the same time, logistical uncertainty around key export routes continues to weigh on physical flows, particularly for cargoes moving out of the Gulf region.
The combination of reduced diplomatic optimism and constrained supply has left crude trading with a firm geopolitical premium. Unless there is a clear shift back toward negotiations, market direction is expected to remain driven by headline developments, with Brent holding above the $105 level as traders price in sustained uncertainty rather than temporary tension.