Investing.com– Oil prices rose in early Asian trade on Thursday, after U.S. President Donald Trump said Washington was ready to strike Iran if the country did not agree to a peace deal.
But Trump also noted that he was willing to wait on more military action, having earlier flagged progress in negotiations with Tehran.
for July rose 0.5% to $105.53 a barrel, while rose 0.9% to $94.83 a barrel by 20:05 ET (00:05 GMT).
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Both contracts recovered from two days of losses, with oil prices having fallen sharply on Wednesday after Trump flagged progress in talks with Iran.
But Trump had later on Wednesday warned that the U.S. was ready to proceed with strikes against Iran, and that the situation was “right on the borderline.”
Trump said he could wait “a few days” before any further action.
Tehran rebuked Trump’s threat, warning against renewed U.S. and Israeli attacks, and that any such move could greatly escalate the war.
Iran also launched a new “Persian Gulf Strait Authority” to control traffic in the Strait of Hormuz, having earlier outlined plans to charge tolls in the channel.
Hormuz remained largely closed. While data on Wednesday showed two Chinese oil tankers had successfully crossed the channel, traffic through the crossing remained at a fraction of pre-war levels.
Hormuz supplies roughly 20% of the world’s oil, with its closure being a key driver of oil prices as global supply was disrupted.
Data released on Wednesday showed an outsized weekly drop in U.S. , as Washington ramped up oil exports to help plug some supply gaps stemming from Hormuz’s closure.