Brent futures rose $5.79 or 5.7% to settle at $108.01 per barrel
Oil settles up nearly 6% as investors fear further Middle East escalation
Crude futures closed higher on Thursday, rebounding from the previous session's losses, as hopes for a swift end to the war in the Middle East faded.
Brent futures rose $5.79 or 5.7% to settle at $108.01 per barrel on Thursday, while the U.S. West Texas Intermediate crude futures gained $4.16, or 4.6% to close at $94.48 a barrel. Trading volume for the front-month Brent contract was the lowest since Feb 27, the day before the United States and Israel began strikes on Iran.
U.S. Special Envoy Steve Witkoff confirmed that the United States sent a "15-point action list" to Iran as a basis for negotiations to end the war. Iranian Foreign Minister Abbas Araqchi said earlier that Iran was reviewing the U.S. proposal but that there were no talks on winding down the war.
A senior Iranian official told Reuters on Thursday that the proposal was "one-sided and unfair," even as U.S. President Donald Trump said Iran has offered to let 10 oil tankers transit the Strait of Hormuz as a goodwill gesture in the negotiations.
"There's purely confusion and frustration over the veracity of stories coming out of the United States and Iran. Investors are once again rotating into safer assets in an effort to preserve capital," said Timothy Snyder, chief economist at Matador Economics.
The Pentagon is planning to send thousands of airborne troops to the Gulf to give Trump more options for a ground assault, sources have told Reuters, adding to two Marine contingents already en route. On the Iranian side, Yemen's Iran-aligned Houthi movement said it stands ready to strike the key Red Sea waterway again in solidarity with Iran, a Houthi leader told Reuters.
"Ongoing military escalation, including troop deployments and fresh strikes, alongside limited tanker movement under strict Iranian conditions, continues to strain global energy markets," MUFG analyst Soojin Kim said.
The war has nearly halted shipments through the Strait of Hormuz, which typically carries about a fifth of the world's crude oil and LNG supply, in what the International Energy Agency has called the biggest oil supply disruption ever.
