ISLAMABAD: Global oil markets remained volatile on Friday, with prices swinging as traders assessed the durability of the Iran–US ceasefire ahead of high-stakes talks in Islamabad.
As of now, benchmark crude is trading in a choppy band around the mid-to-high $90s per barrel, with Brent crude hovering near the $96–$99 range, reflecting intraday swings driven by conflicting signals on supply flows and geopolitical risk.
The market’s immediate reaction to the ceasefire had been sharply bearish, with prices falling earlier in the week on expectations of resumed flows through the Strait of Hormuz, a narrow waterway transit route for roughly a fifth of global oil supply.
However, that relief has proven tentative. Traders have reintroduced a partial risk premium amid reports of shipping delays, insurance uncertainties, and incomplete restoration of tanker traffic through the Strait. Israel’s strikes on Lebanon, even after the ceasefire and US President Trump’s statement that Lebanon was not part of the ceasefire, brought tensions back to the market.
Analysts say the current pricing reflects a fragile equilibrium between de-escalation and unresolved operational disruptions. Israel’s not respecting the ceasefire adds fuel to the fire.
“The ceasefire has reduced the likelihood of immediate supply shocks, but physical flows have not normalised yet,” market observers note, pointing to lingering bottlenecks and cautious tanker movement. Iran has stated that the Strait of Hormuz is open but advises ships to pass in coordination with Iranian forces to pass safely, away from mines.
Energy markets are also factoring in broader regional dynamics, including continued tensions along Israel’s northern frontier and uncertainty over the enforcement of ceasefire terms.
Attention is now shifting to Islamabad, where US and Iranian officials are expected to hold critical talks that could determine whether the ceasefire evolves into a sustained de-escalation framework.
Market participants say a credible outcome from the Islamabad talks, particularly any agreement ensuring uninterrupted passage through the Strait of Hormuz, would be the single most important trigger for stabilising prices.
Until then, volatility is expected to persist, with price forecasts ranging from a pullback toward $90 per barrel to a renewed spike above $100 if tensions re-escalate.
