Key points:
- Brent crude rises above $84 a barrel
- WTI crude climbs above $79
ISLAMABAD: Oil prices rose on Monday as uncertainty over the reopening of the Strait of Hormuz kept a geopolitical risk premium in crude markets, despite signs of progress in talks over shipping arrangements.
Brent crude futures rose $1.20, or 1.44 per cent, to $84.79 a barrel by 2206 GMT, according to market data cited by Reuters. US West Texas Intermediate (WTI) crude gained $1.12, or 1.08 per cent, to $79.29 a barrel.
Earlier in the session, prices had surrendered much of their initial gains. Most media outlets reported Brent at $83.54 a barrel and WTI at $78.03 by 0643 GMT, after both benchmarks had gained more than 1 per cent in early trading.
The market remains focused on the Strait of Hormuz, a critical energy chokepoint through which roughly one-fifth of the world’s oil previously moved.
Both benchmarks had fallen more than 7 per cent last week on expectations that Iran and Oman were close to an agreement that could facilitate the reopening of the waterway.
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Iran said discussions with Oman on defining new shipping lanes through the strait were in their final stages, but Tehran has also made clear that reopening would depend on the United States meeting additional conditions.
Iranian Foreign Minister Abbas Araqchi said on Sunday that Tehran was not engaged in talks with Washington and would not begin negotiations as long as the United States breached an interim agreement reached in June.
Uncertainty halts oil decline
The uncertainty has prevented oil prices from extending last week’s sharp decline. Traders are balancing the prospect of restored shipping and increased crude flows against the possibility that negotiations could break down and supply disruptions persist.
“Any major progress towards restoring unrestricted shipping could exert downward pressure on oil prices, while a breakdown in negotiations or renewed supply disruptions could quickly revive the geopolitical risk premium,” said Sugandha Sachdeva, founder of New Delhi-based research firm SS WealthStreet.
The direction of oil prices in the coming sessions is therefore likely to remain closely tied to developments around Hormuz.
A credible reopening could ease supply concerns and push prices lower, whereas continued restrictions or fresh attacks on regional energy infrastructure could rapidly reverse the recent decline.
Recent oil trajectory
Over the past six months, global oil prices have undergone an extraordinary swing, driven primarily by the US-Israel war with Iran, disruptions around the Strait of Hormuz and shifting expectations of a diplomatic settlement.
Brent crude began 2026 near $62 a barrel and climbed steadily to around $70 by the end of January, before settling around $71 in late February.
The market changed dramatically after the conflict erupted on February 28. Brent surged above $85 in early March, crossed $100 within days and reached about $126 a barrel in late March.
It briefly touched nearly $138 in early April in the futures market, its highest level of the year, as the closure of the Strait of Hormuz threatened a major disruption to global oil supplies.
Prices subsequently retreated as fears of a prolonged supply shock eased. Brent fell back towards $100 in May and dropped below $90 in June. By late June, it was around $74, before briefly touching roughly $70 in early July.
Oil then rebounded in July, with Brent climbing into the mid-$80s, before falling sharply again in early August as hopes grew that arrangements could restore shipping through Hormuz.
Brent had averaged about $101 during the main phase of the conflict, despite earlier forecasts that crude could reach $150 or even $200.
As of August 10, Brent was around $84 and WTI was near $79, leaving the market highly sensitive to developments over Hormuz.
