Oil is trying to rise strongly to offset losses from the previous week as US-Iranian tensions return

Oil prices managed to rise strongly during the first trading sessions of the week on Monday, after a losing week; where crude oil prices suffered losses of about 6% by the end of last week, amidst hopes of a near-end to the ongoing conflict for 10 weeks.

However, tensions renewed between the United States and Iran, following U.S. President Donald Trump's rejection of the latest proposal from Tehran to end the war, deeming it unacceptable.

In this regard, Iran described U.S. demands as "excessive," asserting that accepting them would be considered as submission, and emphasized its insistence on controlling the Strait of Hormuz, lifting U.S. sanctions, and releasing its frozen assets.

These tensions contributed to fueling fears about crude oil supplies amid the ongoing disruption of shipping through the Strait of Hormuz, which reinforces the tight supply in the global market.

Official data reported by Reuters showed that China’s imports – the world's largest crude oil importer – fell in April to their lowest level in nearly four years, reflecting the impact of oil supply disruptions in the Middle East.

U.S. President Trump is scheduled to arrive in China on Wednesday, where he is expected to discuss the Iranian file with Chinese President Xi Jinping, alongside other issues, according to statements from U.S. officials reported by Reuters.

In a related context, Saudi Aramco's CEO, Amin Nasser, stated on Sunday that the world has lost about one billion barrels of oil over the past two months, adding that energy markets will need time to stabilize even if oil flows resume.

Kepler shipping data –as reported by Reuters– indicated that three additional oil tankers left the Strait of Hormuz last week with their tracking devices turned off to avoid Iranian attacks, reflecting a growing trend to secure oil exports from the Middle East.

Crude Oil Prices

In today’s trading, Brent crude oil futures for July delivery rose by about 2.10% to reach $103.42 per barrel, while West Texas Intermediate crude oil futures for June delivery increased by approximately 2.19% to trade close to the level of $97.51 per barrel.