Brent crude oil futures traded around $95 per barrel on Wednesday, holding near recent lows as markets balanced cautious optimism over a possible second round of United States and Iran peace talks against the continued reality of a major supply disruption in the Strait of Hormuz.
President Donald Trump said discussions could resume within days and suggested the war may be close to ending, even as US forces continue to restrict Iranian exports through a naval blockade. Trump had ordered the blockade after the US and Iran failed to reach an agreement during negotiations in Pakistan over the weekend, with Vice President JD Vance stating that Iran would not provide an affirmative commitment not to seek nuclear weapons.
Tehran is reportedly considering a temporary halt in shipments through the Strait of Hormuz corridor to support progress toward a deal. The waterway is one of the world’s most critical oil transit routes.
On the demand side, the outlook remains under significant pressure. The International Energy Agency (IEA) expects global oil demand to decline this year for the first time since the 2020 pandemic, as elevated energy prices linked to the conflict curb consumption.
Inventory data added to the bearish signal. The American Petroleum Institute (API) reported that US crude inventories rose by 6.1 million barrels last week, marking the eighth straight weekly build, pointing to weakening demand in the world’s largest oil consumer.
The scale of the supply shock remains historically significant. ANZ estimates that nearly 10 million barrels per day of crude supply have been removed from effective global availability, turning what was expected to be a modest surplus at the start of the year into a deep deficit. The Australian bank sees Brent trading above $90 per barrel through 2026 before easing toward year-end.
Analysts say the market is now driven by a tug-of-war between geopolitical risk premiums and weakening demand fundamentals, with prices expected to remain highly reactive to any new developments in US-Iran negotiations or changes in shipping conditions through the Strait.
