Oil Holds Gains as Middle East Tensions and US Stockpiles Drive Market Caution

Highlights:

• Brent crude hovered near US$67, while WTI stayed above US$65, as oil prices steadied after a 0.6% gain.
• Iran’s communication cutoff with UN officials deepened uncertainty around its nuclear program, fueling geopolitical tensions.
• Analysts warn the Israel-Iran ceasefire may be short-lived, keeping the oil market sensitive to potential conflict escalation.

Oil Prices Stabilise After Modest Climb

Oil prices steadied in early trading, as geopolitical risks in the Middle East and U.S. inventory data remained in focus for traders. At the time of writing, Brent crude was hovering near US$67 per barrel, following a 0.6% gain on Tuesday, while West Texas Intermediate (WTI) stayed above US$65.

Iran’s Nuclear Standoff Adds to Volatility

The market continues to monitor developments involving Iran, which has reportedly cut off communication with key UN nuclear watchdog officials. This move adds to growing international unease surrounding Tehran’s nuclear intentions and its escalating diplomatic standoff with the United States.

Meanwhile, U.S. President Donald Trump announced Israel’s agreement to a 60-day ceasefire in Gaza, a development that has brought some temporary relief to markets. However, analysts remain sceptical about the ceasefire’s longevity.

Analysts Warn of Market Whiplash

Experts caution that the oil market remains fragile and highly sensitive to renewed conflict. “Warfare is non-linear, and any small action could prove a flash point eventually,” said June Goh, senior oil market analyst at Sparta Commodities. She added that any breakdown in the Iran-Israel ceasefire could rapidly reverse current market stability.

Looking Ahead

With energy traders watching both geopolitical risks and weekly U.S. crude inventory reports, oil prices may continue to fluctuate as sentiment shifts between optimism and caution. The situation remains fluid, and any escalation could trigger renewed price spikes.

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