Brent hits $94 as Trump dampens Iran deal hopes
Brent rose to $94.34 after Trump's Iran remark. Why freight rates and Hormuz attacks keep oil prices elevated despite de-escalation hopes.
Key Takeaways
- Brent rose as high as $94.34 after a Trump remark on Iran.
- Crude is still about 20 percent below its October high of $118.
- Attacks on ships and costly freight keep a floor under prices.
Anyone betting on a quick Iran deal on Thursday got a rude awakening just after 2 p.m. German time. Within minutes, Brent climbed as much as $1.20 to $94.34. A day earlier, the benchmark had briefly traded below $90.
Down a fifth, yet the floor stays high
Since the peak of $118 at the end of October, crude has lost about 20 percent. Hopes for de-escalation in the Middle East and in the Russia-Ukraine war drove the slide, as OilPrice.com author Tsvetana Paraskova notes. In her view, prices are unlikely to fall much further for now: the cost of simply getting a barrel to a buyer remains exceptionally high.
The numbers behind that are stark. The International Energy Agency put freight from the Gulf to Asia at more than $37 per barrel in mid-October, over five times the prewar level. A supertanker on the Gulf–China route cost about $1.29 million per day on November 6, still 4.8 percent less than the week before.
The cause is the attacks on shipping. The Washington Institute counted 37 attacks on vessels in October, more than in any month since the war began on February 28. At least ten more followed by November 10. Shipping companies therefore keep avoiding the route.
Politics moves the price, not fundamentals
The trigger for Thursday's jump was a post by Donald Trump on Truth Social. The US, the president wrote, does not need a deal with Tehran, because it has Iran's money and the Strait of Hormuz. According to Finanzmarktwelt, Trump had sounded far more conciliatory since the midterm elections; the tone now feeds fears of escalation.
Tehran is playing the same card. Chief negotiator Ghalibaf said shipping in the strait will never return to its former conditions. He is still waiting for Washington's answer to seven Iranian demands, including an end to the US blockade in the Gulf of Oman. Paraskova describes a standoff: neither agreement nor escalation, and that is exactly what supports the price.
What momentum says
At the time of our snapshot, Brent stood at $95.54. Momentum signals a bullish state on the hourly (1h) and four-hour (4h) charts. On the daily timeframe (1D) it reads bearish, while on the weekly timeframe (1W) it is bullish again. Short-term upside and a weaker daily structure thus pull against each other.
Scenarios
If Brent falls below $90 again, as it briefly did on November 11, the market would lean harder toward a diplomatic solution. After the latest remarks, that would require signals from Washington on Iran's demands.
If the blockade and the attacks on ships continue, a persistently high price floor looks likely. The October high of $118 would remain a reference point, though it is far away.