West Texas Intermediate (WTI) Crude Oil trades in a volatile and choppy range on Tuesday as traders remain cautious ahead of a deadline set by US President Donald Trump for Iran to reach a deal.
At the time of writing, WTI is trading around $104.30, with a geopolitical risk premium embedded in prices amid concerns about supply disruptions in the Strait of Hormuz.
Donald Trump issued a fresh warning in a Truth Social post, saying, “A whole civilization will die tonight, never to be brought back again. I don’t want that to happen, but it probably will.”
This follows an earlier threat from Trump that the United States could target Iran’s energy and civilian infrastructure if no agreement is reached or if the Strait of Hormuz is not reopened by 8:00 p.m. Eastern Time (00:00 GMT on Wednesday).
Meanwhile, Axios reported on Tuesday that progress has been made over the past 24 hours in negotiations between the US and Iran. However, according to US and Israeli officials as well as other sources familiar with the talks, reaching a ceasefire deal before Trump’s deadline still appears unlikely.
Overall, the uncertain outcome of the US-Iran standoff is likely to keep Oil prices supported in the near term unless tensions de-escalate meaningfully.
According to the latest Short-Term Energy Outlook from the US Energy Information Administration, global Oil markets are already experiencing significant supply tightness due to the effective disruption of flows through the Strait of Hormuz, which handles nearly 20% of global Oil supply.
The report estimates that production shut-ins reached around 7.5 million barrels per day in March and could rise to over 9 million barrels per day in April.
The EIA also projects that WTI crude oil prices will average around $87 per barrel in 2026 and expects global Oil demand growth to slow, forecasting an increase of around 0.6 million barrels per day (b/d) in 2026, down from 1.2 million b/d in the previous month’s report.
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