U.S. oil prices rose Thursday after President Trump said the United States does not need a deal with Iran, stoking worries that the war may not be nearing an end, CNBC reported.
Brent crude traded 1.9% higher at $94.48 a barrel. West Texas Intermediate futures were up 2% at $88.19. "We don't need a deal with Iran. Those days have long since passed. We've got their money, Hundreds of Billions of Dollars, and we've got their Strait!" Trump wrote on Truth Social, referring to the Strait of Hormuz. Those gains came after a sharp November retreat: WTI is down 16% this month, and Brent has lost 20%, as earlier comments after the midterms eased fears of further U.S. strikes. On Sunday, Trump had said fresh attacks were highly unlikely as talks progressed, and that further military action did not appear necessary "at this point," even as both countries reported that shipping had been hit in or near the strait.
John Kilduff, a partner at Again Capital, told CNBC that "the market may have gotten ahead of itself on pricing in a cessation of hostilities," and that renewed doubts about a deal would push the security premium higher. He also warned that Trump's assertion that the United States controls the strait could spur further Iranian attacks on shipping. A separate report this week described gasoline prices slipping below $4 a gallon as Brent had recently traded closer to $90; Thursday's jump is a later snapshot, not a contradiction of that earlier decline.
A blockade theory, and unchanged demands
Jeffrey Currie, founder of Real Macro, said near-term prices may stay relatively tame because a substantial volume of oil is now coming out of the Middle East, but that high insurance and tanker rates are keeping longer-dated futures elevated. "While it caps the prompt barrel, it does nothing to cheapen the next one, which is why you can't get bearish here nor can you get really bullish," he told CNBC. He said he still favors long-dated oil and drilling and producer stocks.
Andy Lipow, president of Lipow Oil Associates, said the president may believe an economic blockade will force Iran to negotiate or collapse, while Iran may instead keep attacking regional infrastructure to drive prices higher and force talks. "It does not seem to me that either side's negotiating position has changed," Lipow said. "Iran wants the blockade to end, sanctions to be lifted and a ceasefire including Lebanon to be declared. The USA wants Iran to get rid of its entire nuclear stockpile and allow free transit through the Strait of Hormuz."