Oil prices surged significantly on Friday morning, responding to the recent developments in US-Iran negotiations that concluded without an agreement in Geneva. As a result of escalating tensions, the US has started evacuating personnel from various embassies in the Middle East. Futures for Brent crude, the international pricing benchmark, increased by 2.9%, trading above $72.90 per barrel, while West Texas Intermediate (WTI) crude futures rose by 3%, crossing the $67 mark. Both benchmarks are now at six-month highs.
During the talks in Geneva, the US and Iran remained deeply divided over critical issues, despite Oman’s Foreign Minister Badr Albusaidi, who is mediating the discussions, indicating some progress had been made. The prospect of further talks in Vienna looms, with technical teams from both sides, including nuclear and banking experts, anticipated to participate.
In tandem with diplomatic efforts, the US has escalated its military presence in the region, enhancing security measures for American citizens. On Friday, the US embassy in Jerusalem announced it had authorized the evacuation of non-essential personnel and their families. The embassy advised that these individuals “may wish to consider leaving Israel while commercial flights are available.” Furthermore, regional news sources reported that the US had ordered the evacuation of personnel from its embassy in Baghdad, although a State Department spokesperson refuted these claims through a social media post.
Oil markets remain acutely aware of the geopolitical dynamics surrounding Iran, particularly regarding the Strait of Hormuz. This vital shipping route, through which approximately 20 million barrels of oil daily transit, is critically important to global oil supply. Iran, asserting extensive control over the strait, has repeatedly threatened to block this passage, warning of severe retaliation should the US conduct military strikes. The ongoing tensions and their implications for oil supply continue to drive price volatility in the energy sector.
