Oil prices soared on the threat of disrupted talks and escalation between the U.S. and Iran
Oil prices rose after reports of a breakdown in talks between the US and Iran / Photo: Vova Shevchuk / Shutterstock.com
Oil prices jumped more than 3.5% following the publication of Axios, which cited two U.S. officials as reporting disagreements over upcoming talks between the U.S. and Iran scheduled for Friday, February 6.
Initially, the sides decided that the meeting would be held in Istanbul with the participation of observers from Middle Eastern countries, but Tehran proposed to change the format to a bilateral one and the venue to Oman, the publication said. The US rejected the proposal, while Iran, according to Axios' interlocutors, is not ready to return to the original plan.
As a result, futures for Brent crude oil rose 3.6% to $69.8 per barrel, after which they slowed down and at the time of publication of this text were trading in the plus by 2.1%. Exchange contracts for North American WTI at the moment added 3.7% - up to $65.5 per barrel.
"The bullish momentum was also amplified by President Donald Trump, who said in an interview with NBC that Iran's supreme leader Ali Khamenei "should be very concerned."
The situation has escalated after incidents at sea and in the air, CNBC notes. The U.S. military said the previous day that it had shot down an Iranian drone approaching the aircraft carrier USS Abraham Lincoln, and in the Strait of Hormuz, Iranian boats attempted to stop a U.S.-flagged merchant vessel.
Traders are closely watching the risk of a possible U.S. military intervention in Iran, which threatens to disrupt the functioning of key shipping routes and the work of the Islamic republic's energy sector, which produces about 3.3 million barrels of oil per day, Bloomberg writes.
"Geopolitical tensions are really driving this process [of rising oil prices]," Equinor CFO Torgrim Reitan told the agency. - The fundamental balance speaks in favor of a lower price than the current one, but with everything that's going on, it's very hard to say where it will all end up".
This article was AI-translated and verified by a human editor
