Oil markets respond to Trump remarks on renewed US-Iran talks

Energy expert Mustafa Al-Bazarkan, Director of the Center for Energy Studies, explained the reasons behind the positive reaction of oil markets to US President Donald Trump’s announcement of a new round of negotiations with Tehran.

Speaking in an interview with Al Arabiya FM, Al-Bazarkan said markets have become accustomed to a war of statements following the suspension of military operations, and that Trump’s remarks were clear regarding the resumption of talks.

He added that Trump’s announcement signals a return to the previous memorandum of understanding, alongside increased US oil production. Trump is currently facing midterm congressional elections and has an interest in lowering oil prices, despite the impact this may have on producing countries.

The center director noted that Trump had promised Americans lower fuel prices, especially during the summer. However, US oil exports have risen to nine million barrels per day while the US strategic reserves have declined. As a result, prices dropped immediately after Trump’s statements about the talks, taking into account other factors affecting supply and demand.

President Trump had earlier announced the cancellation of a major strike planned against Iran after several regional countries intervened, calling for de-escalation and a return to negotiations. The Strait of Hormuz tops the agenda for the upcoming talks, with regional states seeking to ensure safe maritime navigation and secure oil exports through the strait, free from Iranian threats to assert control.

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