Video taken by drone of the Valero Houston Refinery in Pasadena, a suburb of Houston, Texas, on May 12, 2026. Reuters/Shahzad Lasek
Shahrzad Lasek | Reuters
Oil prices were mixed on Tuesday as U.S. military operations in southern Iran and President Donald Trump’s mixed messages on Iran-U.S. negotiations spooked traders.
In Asian trading, international benchmark Brent crude oil July futures rose 1.6% to $97.72 per barrel, while U.S. West Texas Intermediate June futures fell 5.4% to trade at $91.38 per barrel.
The U.S. military said it “conducted self-defense strikes in southern Iran today,” targeting ships believed to be attempting to deploy mines and missile launch sites. U.S. Central Command said the action was aimed at “protecting U.S. forces from threats posed by Iranian forces.”
As peace talks become complicated, President Trump said in a social media post Monday that he encouraged Saudi Arabia, Qatar, Pakistan, Turkey, Egypt and Jordan to join the Abraham Accords, which aims to normalize relations between Arab states and Israel.
President Trump also said negotiations with Iran were “progressing well,” but warned that the United States could resume military action if talks break down. “It’s either a great deal for everyone, or no deal at all,” Trump wrote.
Swiss multinational investment bank UBS said on Friday that global oil markets are showing increasing signs of stress as inventories continue to fall amid continued disruption to shipping through the Strait of Hormuz. Observed global oil inventories fell by a combined 246 million barrels in March and April, and cumulative production losses could exceed 1 billion barrels by the end of May, the central bank said.
UBS said the sharp decline in inventories suggests the market remains “extremely undersupplied,” noting that onshore crude oil and refined product inventories have fallen even as U.S. rerouting of exports to Asia has increased the amount of crude stored in tankers.
