Global oil markets recovered on Thursday after suffering heavy losses a day earlier, as investors reassessed the uncertain future of Middle East peace negotiations. The latest movements in the market pushed the oil prices rebound back into focus after crude benchmarks dropped to two-week lows.
Brent crude futures climbed more than one dollar during early trading, reaching above $102 per barrel. U.S. West Texas Intermediate crude also gained nearly one percent, trading close to $96 per barrel.
The recovery followed a sharp decline on Wednesday when both benchmarks lost more than seven percent. Traders initially reacted positively to reports suggesting progress toward a possible agreement to end tensions in the Middle East.
However, market sentiment shifted after statements from Donald Trump and Iranian officials raised doubts about immediate diplomatic progress. Trump stated that direct talks with Tehran were still premature, while Iranian lawmakers described the latest American proposal as unrealistic.
Investors now remain cautious as negotiations continue ahead of next week’s meeting between Trump and Xi Jinping. Analysts expect discussions between Washington and Beijing to influence broader geopolitical and economic conditions.
Market strategist Hiroyuki Kikukawa said uncertainty continues to dominate trading activity. He noted that oil prices may remain elevated while diplomatic talks continue without a clear breakthrough.
Iran confirmed that officials are reviewing a proposed peace framework presented by the United States. Reports indicate the proposal aims to formally end the conflict while leaving several major disputes unresolved, including Tehran’s nuclear activities and the future of the Strait of Hormuz.
The strategic waterway remains one of the world’s most important energy routes. Any instability around Hormuz quickly affects global oil supplies and market prices.
According to sources involved in the discussions, negotiators are close to drafting a short agreement that could officially reduce tensions in the region. Meanwhile, American media reports suggested Tehran may respond to key proposals within the next two days.
Analysts say the current oil prices rebound reflects growing uncertainty rather than renewed confidence. Markets continue reacting strongly to every diplomatic update, military development, or supply concern emerging from the Middle East.
Experts also warned that even if an agreement is reached soon, oil supply shortages could continue for several weeks. Shipping operations across the Gulf region would require time to fully recover, especially during the peak summer demand season.
Meanwhile, new data from the U.S. Energy Information Administration showed another decline in American crude inventories last week. Falling stockpiles suggest global buyers continue drawing from reserves to offset supply disruptions linked to the regional crisis.
The latest oil price rebound highlights how sensitive energy markets remain to geopolitical developments and uncertainty surrounding future oil supplies.