Fuel prices a gas station in Prague after the government of the Czech Republic responded to soaring oil prices with a cap on fuel distributors’ margins and a cut in diesel excise duty. A daily cap on maximum diesel and petrol prices which retailers must adhere to was due to follow. Photo by Martin Divisek/EPA
April 9 (UPI) — Oil prices were on the rise again on Thursday amid concerns a “fragile” cease-fire between the United States, Iran and Israel could unravel over continued fighting in Lebanon and few signs the Strait of Hormuz was about to reopen to shipping.
The Brent crude and West Texas Intermediate international benchmarks were both trading around 4% higher at $98.62 and $99.94 a barrel respectively in early afternoon trade on Thursday, after prices plunged Wednesday on the announcement of a two-week cessation of hostilities.
Share prices in Asia also fell overnight with the Nikkei 225 in Tokyo giving up some of the gains made on Wednesday with European stocks following suit when exchanges opened Thursday morning.
The market reacted to warnings from both sides that they were prepared to resume military action if the other did not adhere to truce terms neither party accepts are the same, with Tehran saying Israeli strikes on Lebanon were a “grave violation” and Washington saying Iran must comply with the “real” agreement.
There was also growing concern over the reopening of the Hormuz Strait, a key term of the agreement which must be implemented to ease the disruption to global oil supply that has sent prices soaring.
Iranian Deputy Foreign Minister Saeed Khatibzadeh told BBC Radio on Thursday that Iran would “provide security for safe passage” through the sea lane via which around a fifth of the world’s oil and gas is exported, but only “after the United States withdraws this aggression” — an apparent reference to the Israeli strikes in Lebanon.
He stressed that while the 21-mile wide strait had been “open for millennia” prior to the war, it was not international waters and that shipping only transited on the goodwill of Iran and Oman” — the sovereign countries on either side of the channel.
Khatibzadeh dodged questioning over how safe vessels would be and whether they would be required to pay tolls, saying Tehran wanted a “peaceful” arrangement, but that it would not permit “misuse” of the Gulf by warships.
However, London-headquartered shipping brokerage SSY Global said the Iranian navy had issued a warning to ships in the Persian Gulf that any vessels attempting to transit the Strait of Hormuz without permission “will be targeted and destroyed.”
Announcing the cease-fire on Tuesday, U.S. President Donald Trump said the deal hinged on the “complete, immediate, and safe opening” of the strait, a point pressed home on Wednesday by U.S. Vice President JD Vance, who said while there were signs the process was starting Iran was required to fully open the strait.
“The president is very, very clear the deal is a cease-fire, a negotiation. That’s what we give, and what they give is that straits are going to be reopened. If we don’t see that happening, the president is not going to abide by our terms if the Iranians are not abiding by their terms.”
The White House announced Wednesday that Vance would lead the U.S. negotiating team at talks due to get underway in Islamabad, Pakistan, on Saturday.
Khatibzadeh said Mohammad Bagher Ghalibaf, speaker of the Iranian parliament, would head up the Iranian side.
The talks will try to reconcile two very different visions of the way forward — a 15-point U.S. plan and a 10-point Iranian plan — with Iran’s nuclear program which the Americans want totally scrapped but Iran insists on retaining for civilian energy purposes — topping the agenda.
