This overview shows oil tanks and facilities at Yeosu National Industrial Complex, South Korea’s largest petrochemical industrial complex, in Yeosu City, April 7, 2026. (Photo by Shin Yong-ju / AFP via Getty Images)
Shin Young Joo | AFP | Getty Images
Oil prices fell on Tuesday amid uncertainty over the outcome of the second round of peace talks between the US and Iran.
Vice President J.D. Vance will reportedly lead the U.S. delegation to Pakistan, but Iranian statements so far indicate it is not ready for further negotiations.
“We do not accept negotiations under the shadow of threats, and over the past two weeks we have been preparing to reveal new cards on the battlefield,” Iranian Parliament Speaker Mohammad Bagher Ghalibaf said in a post on X on Tuesday.
Meanwhile, US President Donald Trump reiterated his threat of overwhelming military action against Iran, warning that “a bunch of bombs are going to start going off” if a deal is not reached before the fragile ceasefire expires on Tuesday night.
West Texas Intermediate crude oil futures for May delivery were down 1.06% at $88.66 per barrel as of 4 a.m. ET, while international benchmark Brent crude oil futures for June delivery were down 0.81% at $94.71 per barrel. WTI and Brent settled 7% higher and 5% higher on Monday.
Trump has returned to more aggressive rhetoric in recent days, oscillating between escalation and talk of negotiations, as tensions rise following the U.S. military’s seizure of an Iranian ship on Sunday as the president continues to maintain a blockade of Iranian ports.
Rystad Energy said in a note on Tuesday that the Hormuz disruption has already led to a significant upward revision to its 2026 oil price outlook, warning that as much as 2.1 million barrels per day of new supply from South America could become available if oil prices rise to and sustain $100.
“South America is now positioned as the world’s most important source of additional supply,” said Radhika Bansal, senior vice president at Rystad Energy.
“The Middle East conflict has not only caused oil prices to soar, but also exposed how the world’s supply chains are dangerously concentrated around the Strait of Hormuz,” she added.
