Crude oil prices clawed back ground in early Asian trading on Wednesday, with benchmark Brent crude extending its blistering rally as geopolitical tensions in the Middle East refused to ease — even as fresh signals emerged that Washington and Tehran could be inching toward a negotiated end to the month-old conflict.
By 00:10 GMT, the front-month Brent contract for June delivery had climbed 66 cents, or 0.63 percent, to $104.63 a barrel. That came after the contract posted a staggering 64 percent monthly gain in March — the biggest one-month jump on record, according to LSEG data stretching back to June 1988.
U.S. West Texas Intermediate futures mirrored the rebound. The May contract rose 96 cents, or 0.95 percent, to $102.34 a barrel, while the June contract gained 46 cents, or 0.49 percent, to $93.62.
The uptick reversed some of the sharp losses seen Tuesday, when Brent for June settlement dropped more than $3 after unconfirmed media reports suggested Iran’s president was prepared to call time on the fighting. Yet traders remained on edge, underscoring how fragile the market’s nerves have become.
“Even with diplomatic channels reportedly still active and intermittent comments from the U.S. administration predicting a short end to the conflict, the combination of limited tangible diplomatic progress, continued maritime attacks, and explicit threats against energy assets keeps supply risks skewed to the upside,” LSEG analysts wrote in a note to clients.
President Donald Trump added fuel to the speculation Tuesday, telling reporters that the U.S. military campaign could wrap up within “two to three weeks” and that Tehran did not even need to strike a formal deal to end hostilities — his most explicit statement yet that he is eager to wind down the fighting.
Still, analysts caution that any ceasefire would not immediately translate into lower prices. Infrastructure damage from the conflict is expected to keep supplies constrained for months, they say.
Trump has also signaled he could declare victory and pull forces out before the Strait of Hormuz — the narrow chokepoint carrying roughly 20 percent of global oil and liquefied natural gas trade — is reopened, according to a Wall Street Journal report.
The strait’s prolonged closure has already exacted a heavy toll. A Reuters survey released Tuesday showed OPEC oil output plunged by 7.3 million barrels per day in March compared with the previous month, reflecting forced export cuts triggered by the waterway’s blockade.
Those disruptions have prompted the most dramatic revision to oil-price forecasts in more than two decades. In a March poll of analysts conducted by Reuters, the consensus forecast for Brent crude in 2026 jumped to an average $82.85 a barrel — a whopping 30 percent higher than the $63.85 projected in February, before the war erupted. The $19-per-barrel leap marks the largest single-month increase in the survey’s history, which dates back to 2005.
For now, the market is pricing in a delicate balance: cautious optimism about diplomacy on one hand, persistent fear of fresh supply shocks on the other. With tanker traffic still paralyzed, storage levels tightening and seasonal demand ramping up, any hint of renewed escalation — or delay in reopening Hormuz — could send prices rocketing higher still.
Traders will be watching closely for the next signals out of Washington and Tehran. In the oil patch, hope for peace is growing, but the scars of war — and the memory of March’s record rally — mean jittery nerves are likely to remain the dominant sentiment for some time to come.
WHAT YOU SHOULD KNOW
Despite diplomatic signals and President Trump’s indication that the U.S.-Iran conflict could end in 2-3 weeks, oil prices remain elevated and volatile. Brent crude hit a record 64% monthly gain in March and traded near $105/barrel, driven primarily by the closure of the Strait of Hormuz and resulting supply disruptions.
Even if fighting stops soon, damaged infrastructure and delayed reopening of this critical chokepoint (20% of global oil/LNG flows) will keep supplies tight and prices supported well into 2026, with analysts now forecasting Brent at $82.85/barrel next year — a massive 30% upward revision.
