Oil prices rise after Trump says Iran must pay price

LONDON: Oil prices rose on Wednesday after U.S. President Donald Trump scolded Iran in a Truth Social post following tit-for-tat strikes between the U.S. and Iran overnight.

Brent futures were up $1.32, or 1.44%, at $92.77 a barrel by 1220 GMT, while U.S. West Texas Intermediate crude was up $1.57, or 1.78%, at $89.77 a barrel.

“They’ve taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!” Trump said on Truth Social.

Oil prices jumped after the post, having traded more or less steady from the previous close for much of the European morning session.

Trump said he is close to ordering new strikes against Iranian power plants and bridges as Iran is taking too long to make a deal, according to Fox News.

“The hope for a deal has kept oil prices under pressure in recent days, although flows through the Strait remain restricted. Obviously the market now awaits what U.S. President Trump will do next,” UBS analyst Giovanni Staunovo said.

The U.S. military struck Iranian targets after Trump vowed on Tuesday to respond to the downing of a U.S. Apache attack helicopter.

The latest attacks shifted traders’ focus back towards war risks and potential supply disruptions, said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“While diplomatic efforts remain ongoing, the latest military exchanges have reintroduced a geopolitical risk premium into oil markets,” Sachdeva said.

Tehran said it would resume hostilities if Israel continued to attack the Hezbollah militia in Lebanon.

Oil prices fall to seven-week low

Israel’s refusal to end its campaign against Iran-backed Hezbollah has hindered Trump’s efforts to extend a tenuous ceasefire in the wider U.S.-Israeli war with Iran into a durable settlement.

Global stock draws are underpinning prices, but lower Chinese crude oil imports are helping to keep a ceiling on prices, PVM analyst Tamas Varga said.

A limited flow of shipping through the Strait of Hormuz could also be capping prices, he said, as some ships transit but traffic remains significantly below pre-war levels.

Iran has continued to block most shipping through the strait, which normally carries a fifth of the world’s crude oil and liquefied natural gas, while Washington has imposed its own blockade of Iranian ports.

U.S. Energy Secretary Chris Wright said on Tuesday that ship traffic in the Gulf and oil exports through the strait are rising even as Washington and Tehran struggle to reach a deal to end their more than three-month-old war.

U.S. crude oil inventories fell for an eighth week in a row last week, according to market sources citing Tuesday’s data from the American Petroleum Institute, while gasoline stocks also declined.