Oil Claws Back above $100 as Markets Doubt Calm in Middle East

The New York Times, CNBC, the Guardian, Reuters, and Bloomberg contributed to this report.

Oil prices bounced on Tuesday, a day after a brutal sell-off, as traders took a second look at the idea that tensions in the Middle East might be easing.

Brent crude pushed back above $100 a barrel, climbing more than 2%, while US oil prices rose even faster. The rebound comes right after Monday’s sharp drop, when Brent tumbled roughly 11% in one of its steepest single-day falls in months.

That drop had followed upbeat signals from Washington. President Donald Trump said the US and Iran had held “very good and productive” talks and announced a pause on planned strikes against Iranian energy infrastructure. Markets reacted instantly – stocks jumped, oil sank.

But the optimism didn’t last long.

By Tuesday morning, traders were already dialing back expectations. Iran pushed back on the idea that meaningful talks had taken place, and the disconnect left markets uneasy. Oil’s rebound reflects that lingering doubt.

There’s also a bigger issue hanging over everything: the war itself isn’t going anywhere. Attacks on energy infrastructure across the region – and the ongoing disruption to shipping – are still front and center.

The Strait of Hormuz remains a key pressure point. Before the conflict, it handled about a fifth of the world’s seaborne oil. Now, flows have been severely restricted, with Iran allowing only selective passage.

That’s enough to keep traders on edge.

Even if diplomacy picks up, the damage is already done. Repeated strikes on oil facilities and transport routes have raised fears that supply could stay tight longer than expected. And that means higher prices could stick around – even in a best-case scenario.

In other words, Monday’s sell-off may have been driven by hope. Tuesday’s rebound looks more like reality setting back in.