West Texas Intermediate (WTI) oil prices declined to around $93.90 during Asian trading hours on Thursday, following three consecutive days of gains, despite rising geopolitical tensions between the United States and Iran [1]. The conflict has intensified, with Iran declaring its readiness for a more intense confrontation, vowing to resist a US naval blockade and warning of increased attacks if American forces continue their strikes on Iranian territory [1]. US President Donald Trump predicted that the conflict would likely persist beyond the November midterm elections, suggesting that significant relief in gasoline prices is unlikely before then and indicating limited prospects for near-term de-escalation [1].
Hostilities have escalated rapidly over the past week after a period of relative calm, with both nations increasing their attacks. The crisis expanded further when Iran-backed Houthi militants launched strikes on several energy facilities in Saudi Arabia, leading to the temporary suspension of some operations in the region [1].
Strategists at TD Securities noted that crude prices continue to push higher as geopolitical tensions show little sign of easing, stating that 'crude rallies with seemingly no end to conflict in sight.' They emphasized that the preference for limited attacks and economic pressure, rather than negotiations, is keeping the energy market on a tightening trajectory, with ongoing conflict dynamics elevating supply risks and skewing the balance of risks for oil to the upside [1].
Despite the current price decline, the overall market sentiment remains cautious due to persistent supply risks and the potential for further escalation in the Middle East, which could impact global energy supplies [1].
CONCLUSION
WTI oil prices have retreated despite escalating US-Iran tensions and related supply risks in the Middle East. Market analysts highlight that ongoing geopolitical instability is likely to keep oil prices supported, with limited prospects for near-term de-escalation and continued supply concerns.