WTI edges up to near $96.00 as uncertainty persists over US-Iran peace prospects

• A decline of nearly 7% this week, driven by receding fears over Middle East supply, gives way to renewed support for WTI.
• Although Israel suggested an attack could take place this week, Trump indicated there were no immediate plans to strike Iran.
• Fresh peace proposals came from mediators, while Iran’s security chief described Washington’s response so far as unsatisfactory.

At around $96.10 per barrel in Wednesday’s Asian session, West Texas Intermediate (WTI) oil is advancing for a second consecutive day. The rise in crude prices comes as investors weigh uncertainty over the continuing peace talks between the US and Iran.

New proposals from mediators aimed at narrowing the two countries’ differences are being assessed by both sides, according to Qatar’s Foreign Ministry spokesperson. Iran’s national security chief, however, said in a social media post that Washington’s response was still unsatisfactory.

According to the Financial Times, Donald Trump said the US had no immediate plans to attack Iran and appeared to be securing what it wanted. Although the US was prepared to act if necessary, he added, there might be no need to do so. His remarks came despite Israeli Prime Minister Benjamin Netanyahu suggesting an attack could take place later this week.

Earlier this week, defensive US strikes on Iran targeted surface-to-air missile systems that had been used against American assets. Their restricted scope nevertheless points to no immediate resumption of large-scale military operations.

Despite the recovery, WTI, the US oil benchmark, is still around 6% lower so far this week. Hopes of a diplomatic breakthrough, coupled with indications that Middle Eastern crude exports are recovering, continue to underpin the weekly decline.