Oil price today: Oil prices retreat on US-Iran hopes as stocks move sideways - IOL

Brent crude has fallen from recent highs, but South Africans are in for steep fuel prices increases in October.

Oil price today: European and US stocks traded without direction on Tuesday despite oil prices retreating from recent highs as investors weighed the prospects for increased tanker traffic through the Strait of Hormuz.

Hopes for easing Middle East tensions were dashed at the weekend when US President Donald Trump rejected Iran's offer for a seven-day truce, sending oil prices sharply higher on Monday.

But prices reversed course after Trump said on Monday he expects talks with Iran to continue. Brent crude oil was trading around the $103 mark in early afternoon trade on Tuesday, down 2.2%, while West Texas Intermediate was down 2.5% at $90.33 per barrel.

"Traders are keeping their ears open to any indication that the US and Iran are making progress as they separately talk to mediators in an effort to bring about an end to hostilities," said Trade Nation analyst David Morrison.

Briefing.com analyst Patrick O'Hare said oil prices were also "reacting favourably to a report that oil exports out of the Middle East hit a post-war high".

Wall Street's main indices moved little at the opening bell.

European markets were mixed in afternoon trading.

Oil prices still remain elevated, however, and government bond yields are trading at multi-year highs, contributing to losses on some Asian stock markets Tuesday.

Officials in Tehran have privately expressed pessimism about making a deal to reopen the Strait of Hormuz before US midterm elections in just five weeks, Bloomberg News reported sources as saying.

The waterway is key to the world's oil and gas deliveries and is now central to the US-Iran conflict, particularly with the Iran-backed Houthis seizing Yemen's entire Red Sea coast, including the Bab al-Mandab Strait, another vital shipping lane.

The situation is keeping global inflation high, pushing the US Federal Reserve and European Central Bank to raise interest rates earlier this month.

US inflation and jobs data this week will help signal whether the Fed hikes again in October, an outcome already likely according to prices in the US Treasuries market.

Expectations of more rate increases are supporting the dollar, in turn weighing on gold, which is priced in the US currency.

Australia's central bank raised its key interest rate to a 15-year high of 4.6 percent on Tuesday in a bid to tackle fallout from elevated oil prices.

It added that the rise of artificial intelligence was driving up technology costs.

OpenAI said Monday that it would not release its newest artificial intelligence model, known as Astra 6.1, after internal testing by the ChatGPT-maker revealed it did not meet safety standards.

It comes as leading artificial intelligence executives prepare to meet at the White House on Tuesday with Trump as Congress calls for stronger industry oversight.

In other company news, shares in the fast-fashion giant Shein plunged almost 14 percent at one point in Hong Kong after it released disappointing earnings.

It was the firm's first report since listing at the start of the month following a high-profile $1.7 billion initial public offering.

Shein's share price has now fallen more than 35 percent since its first day of trading.