(Investing) – Oil prices climbed over 2% in European trade on Tuesday after Iran denied that negotiations with the U.S. had taken place since the beginning of the war, contradicting President Donald Trump’s claims.
The futures contract expiring in May for Brent crude, the global oil benchmark, rose 2.7% to $102.62 per barrel by 10:07 ET (14:07 GMT), while U.S. West Texas Intermediate crude futures climbed 3.8% to $91.51 a barrel.
Oil prices previously plummeted over 10% on Monday after Trump temporarily postponed a threat to bomb Iran’s electricity grid, citing “very good and productive” talks with unidentified Iranian officials.
Trump said he was delaying his plan to attack Iran’s energy grid by five days. But Iran’s Speaker of the Parliament, Mohammad Baqer Qalibaf, said on social media that no such talks had taken place, leaving markets uncertain over the state of the war and oil supplies in the Middle East.
Reuters reported that while direct U.S.-Iran talks had not taken place, Egypt, Pakistan, and Gulf states were relaying messages between the two nations. Iran’s foreign ministry was also seen outlining initiatives to reduce tensions.
But hostilities in the Middle East showed few signs of stopping, as the conflict entered its fourth consecutive week. Several locations in Israel have been bombarded, including in Tel Aviv, media reports said. The Wall Street Journal also reported that Kuwait and Saudi Arabia have been targeted by drone and missile strikes, while Israel said it had struck targets linked to Iran-backed Hezbollah in Lebanon.
Oil prices have recently surged to nearly $120 a barrel as Iran effectively blocked the Strait of Hormuz, a key shipping lane that supplies about a fifth of the world’s oil consumption. Prior to the start of the conflict, Brent was exchanging hands at roughly $70 a barrel.
“As long as there’s uncertainty around potential disruptions to global supply, crude is likely to stay elevated relative to pre-conflict levels,” Ed Egilinsky, Managing Director, Head of Global Sales/Distribution & Alternatives at Direxion, told Investing.com.
(Ambar Warrick and Ayushman Ojha contributed to this report.)
