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The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
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Sign InBrent crude prices rose to $106.63 per barrel following President Trump's rejection of Iran's response to a US peace proposal, which he characterized as 'totally unacceptable.' The diplomatic friction stems from reports that Iran demanded full sanctions relief in exchange for reopening the Strait of Hormuz. This price action marks a gradual recovery during this week's trading from a low of $96 recorded last week.
The breakdown in negotiations reintroduces a geopolitical risk premium to the energy markets, specifically regarding supply security in the Gulf region. In context, the EIA Weekly Petroleum Report released on May 6, 2026, showed a stock draw of 2.314 million barrels, which was narrower than the forecasted decline of 3.3 million barrels per market data. Analysts suggest that the failure to reach a diplomatic resolution may keep prices elevated as supply concerns outweigh cooling demand signals.
Looking ahead, Brent crude stands at $106.63 (close May 12, 2026), with established support near the $96 level seen in the previous week. Traders should monitor upcoming energy agency reports and any further official statements regarding Iranian oil sanctions as primary catalysts. Market volatility is expected to remain high as long as the status of the Strait of Hormuz remains uncertain.
Update: The latest EIA data for the week ending May 8 revealed a sharp decline in US crude oil inventories by 4.3 million barrels. This draw brought commercial stockpiles down to 452.9 million barrels, approximately 0.3% below the five-year average, further supporting price levels as supply tightness persists.
Update: The IEA stated in its latest monthly report that global oil supply is projected to fall below total demand this year. The agency attributed this anticipated deficit to the impact of the conflict in Iran on Middle Eastern production, further supporting the bullish case for crude prices.
Update: Geopolitical tensions escalated further following remarks from Israeli Prime Minister Netanyahu, who warned that the conflict with Iran is 'not over.' These comments have intensified market fears regarding regional instability, providing additional support to crude prices alongside the stalled diplomatic efforts between Washington and Tehran.
Update: These gains are further supported by a broader rally that has seen oil prices surge more than 70% since the start of the year. Additionally, U.S. crude (WTI) is now trending toward the $100 per barrel psychological milestone, reflecting the intensity of current market momentum.
Update: WTI crude joined the rally, surging 4.9% to break above the $100 per barrel threshold. Warren Patterson of ING Economics noted that the oil market remains highly sensitive to geopolitical developments involving Iran and potential supply disruptions in the Persian Gulf.