A drone view shows the Valero Houston Refinery in Pasadena outside of Houston, Texas, U.S., May 12, 2026. REUTERS/Shahrzad Rasekh
Shahrzad Rasekh | Reuters
Oil prices were mixed Tuesday as U.S. military operations in southern Iran on Monday and President Donald Trump’s mixed messaging on the negotiations between Tehran and Washington kept traders on edge.
July futures for international benchmark Brent crude gained 1.6% to $97.72 a barrel in Asia trading, while U.S. West Texas Intermediate futures for June was trading 5.4% lower at $91.38 per barrel.
The U.S. military said it conducted operations in southern Iran, targeting vessels allegedly trying to deploy mines, as well as missile launch locations. The U.S. Central Command said the actions were intended “to protect our troops from threats posed by Iranian forces.”
Complicating peace talks, Trump said in a social media post Monday that he had encouraged Saudi Arabia, Qatar, Pakistan, Turkey, Egypt and Jordan to join the Abraham Accords aimed at normalizing Arab nations’ ties with Israel.
Trump also said negotiations with Iran were “proceeding nicely,” but cautioned that the U.S. could resume military action if discussions were to collapse. “It will only be a Great Deal for all or, no Deal at all,” Trump wrote.
Swiss multinational investment bank UBS said Friday the global oil market was showing mounting signs of strain as inventories continue to fall amid ongoing disruptions to shipments via the Strait of Hormuz. Observed global oil inventories dropped by a combined 246 million barrels in March and April, while cumulative production losses could exceed 1 billion barrels by the end of May, the bank said.
The sharp inventory drawdowns suggest the market remains “strongly undersupplied,” UBS said, pointing to falling on-land crude and refined product inventories even as oil stored on tankers rose due to rerouted U.S. exports to Asia.
