Oil prices recovered on Wednesday, ending a run of five consecutive losing sessions, as markets reacted to Iranian President Masoud Pezeshkian’s remarks that the Islamic Republic would not surrender to the United States.
Brent, the international benchmark, rose 3.9% to close at $103.08 a barrel, while U.S. West Texas Intermediate (WTI) gained 1.8%, to $92.16 a barrel.
“They tested Iran’s strength and determination and learned that Iran cannot be forced into surrender,” Pezeshkian said in his speech to the UN General Assembly in New York.
The rise in prices came after intense volatility in previous days, with U.S. crude nevertheless remaining 8% lower on a weekly basis, while Brent has narrowed its losses to around 1%.
The Trump–Tehran Confrontation Keeps Markets on Alert
Investors are closely monitoring developments in relations between Washington and Tehran, following Donald Trump’s remarks that U.S. officials had a “very good meeting” with the Iranian delegation, which lasted around three hours.
However, in his speech at the UN on Tuesday, the U.S. president said he was facing a “big decision” on whether to seek a deal with Tehran or proceed with the “elimination” of Iran.
The fate of the Strait of Hormuz remains at the center of attention, as a significant share of global energy shipments passes through it. According to Reuters information, Iran could reopen the Strait within a week if the U.S. reduces military pressure and lifts the blockade of Iranian ports.
At the same time, Pakistan’s mediation role is estimated to be capable of reducing the risk of wider escalation.
“Pakistan’s mediation efforts with Tehran could also reduce the risk of a wider escalation,” said Paolo Broccardo, CEO of digital bank BankPro.
Middle East Supplies Limit the Rally
Despite Wednesday’s upward reaction, analysts estimate that prices are unlikely to surge sharply in the immediate term, as the market has already priced in part of the geopolitical risk.
“Over the past five sessions, the price has fallen by nearly 12%, moving away once again from the zone above $100, where we have repeatedly seen efforts toward de-escalation and peace initiatives intensify,” Broccardo said.
At the same time, markets are being affected by increased oil flows from the Middle East. Saudi Arabia has restarted the East-West Pipeline to the Red Sea, while offering additional cargoes to Asian refineries from locations outside the Strait of Hormuz.
Iraq also announced that its exports exceed 3 million barrels per day, with the aim of increasing flows through Turkey to more than 600,000 barrels per day.
Meanwhile, U.S. crude oil inventories increased by 3 million barrels to 426.4 million barrels in the week to September 18, according to the Energy Information Administration (EIA), while analysts had expected a decline of 641,000 barrels.
In the fuel market, low-sulfur diesel futures fell by around 5% following reports that the Trump administration was considering a 90-day ban on diesel exports, a plan that the White House subsequently denied.
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