Oil rebounds amid US-Iran war uncertainty

Oil prices rebounded slightly on Tuesday after plunging in the previous session, as concerns over Middle East supply disruptions persist due to the ongoing U.S.-Iran war. Front-month Brent crude rose 0.7% to $84.39 a barrel, while WTI gained 0.7% to $80.95, following a 7% drop in Brent and over 5% drop in WTI the prior session. The selloff was triggered by U.S. President Donald Trump's announcement on Sunday that he was holding off on new attacks on Iran pending talks to end the war and resolve the dispute over the Strait of Hormuz. However, Iran's Foreign Ministry spokesman Esmail Baghaei rejected Trump's claim, stating that no negotiations are taking place and no meetings are scheduled. The Strait of Hormuz remains a central sticking point, with Washington asserting that a June memorandum of understanding required Iran to open the waterway, while Tehran argues the text preserved its authority. Shipping data shows that crude and refined product net exports through the strait averaged 4.2 million barrels per day in the week ended July 31, up from 3.2 million the previous week. In the Red Sea, six Saudi-flagged supertankers changed course in the Gulf of Aden, heading to southern Africa, while two tankers laden with Saudi oil crossed the Bab el-Mandeb Strait. The United Kingdom — Naval co-operation and guidance for shipping flagged an incident near Oman's Al Khasab after a cargo vessel reported being hit by an unknown projectile. Analysts note that the fighting between Saudi Arabia and the Houthis has forced longer voyage times, higher insurance costs, and occasional diversions, keeping a dual-chokepoint risk in the market.