The Hormuz negotiations are at a standstill, and the tension in the Middle East continues to "heat up" oil prices

Supported by the uncertainty of the reopening prospects of the Strait of Hormuz and the ongoing tensions in the Middle East, both WTI and Brent crude oil prices continued to rise in the U.S. trading session. Iran reiterated several conditions before agreeing to fully reopen the strait. According to Al Jazeera, the conditions proposed by the Secretary of the Supreme National Security Council of Iran, Zolghadr, include: ending the U.S. maritime blockade and the withdrawal of the U.S. Navy and Air Force from around Iran.

Tehran also demanded compensation for damages caused by recent conflicts, the lifting of sanctions, and the unconditional unfreezing of Iranian assets. These demands currently reduce the likelihood of a swift return to normal shipping and help maintain the risk premium in WTI prices. Meanwhile, negotiations with Oman to establish a secure shipping route through the Strait of Hormuz seem to be making progress.

However, due to the failure to reach an agreement on full reopening, investors remain cautious about the risks of long-term disruptions to oil supply. Regional tensions are not limited to the Strait of Hormuz. The Iran-backed Houthi forces in Yemen claimed responsibility for a drone attack on Saudi Aramco's refinery in Saudi Arabia. The latest attacks on major energy infrastructure have heightened market concerns about the security of regional oil supplies.