Brent crude settled at $97.81 per barrel, up $1.81 (1.9%), while West Texas Intermediate (WTI) crude gained $2.26 (2.4%) to close at $96.02 per barrel. The advance built on Tuesday’s gains as traders reassessed the likelihood of a near-term resolution to the conflict.
Geopolitical tensions intensified after Iran launched ballistic missile attacks toward Kuwait and Bahrain, resulting in casualties and injuries, while U.S. forces carried out strikes on Iran’s Qeshm Island. The renewed hostilities dampened expectations for a ceasefire and reinforced market concerns about the security of regional energy supplies.
Negotiations between Washington and Tehran showed little sign of progress. Iranian Foreign Minister Abbas Araqchi stated that communications between the two countries remain open and that both sides continue to review proposals that have been exchanged. However, Iranian media reported that formal exchanges through intermediaries have been suspended pending progress on Tehran’s demands regarding the conflict in Lebanon.
The continued impasse has kept attention focused on the Strait of Hormuz, where shipping restrictions remain a major constraint on global oil flows. Analysts noted that the prolonged disruption of traffic through the waterway continues to support elevated risk premiums across crude markets.
Additional support came from growing concerns over tightening inventories. The International Energy Agency recently warned that global oil stockpiles could reach critically low levels during the peak summer demand season if current drawdown rates persist.
In the United States, crude inventories fell by 8.0 million barrels during the week ending May 29, according to the Energy Information Administration. The decline was substantially larger than analysts’ expectations for a 4.0 million barrel draw and reflected strong export activity and refinery demand. The larger-than-expected inventory reduction reinforced concerns about tightening supplies and helped push oil prices higher.