Oil prices pare gains as Trump says US-Iran talks are ongoing

June 2, 2026 - 04:37

Oil prices trimmed earlier gains on Monday after former President Donald Trump stated that negotiations between the United States and Iran remain active, contradicting reports that Tehran had cut off communication with American negotiators. The comments helped calm market fears of an immediate supply disruption, though crude still ended the session higher.

Brent crude futures settled up 0.8% at $73.20 a barrel, while U.S. West Texas Intermediate crude rose 0.7% to $69.45. Prices had jumped more than 2% earlier in the day following unconfirmed reports that Iran had halted diplomatic channels with the U.S. over disagreements on nuclear program inspections. Traders worried that a breakdown in talks could lead to renewed sanctions or even military escalation in the Strait of Hormuz, a critical chokepoint for global oil shipments.

Trump, speaking to reporters at his Mar-a-Lago estate, said "the discussions are still happening" and that he had received updates from intermediaries. He did not provide details but urged patience, adding that "both sides want a deal." His remarks immediately reversed some of the intraday spike, as investors interpreted them as lowering the risk of an immediate conflict.

Analysts noted that the oil market remains highly sensitive to any news from the Middle East, especially with OPEC+ already struggling to enforce production quotas. A full halt in talks could push prices toward $80, while a diplomatic breakthrough might send them back below $70. For now, traders are watching for any official statement from Tehran to confirm or deny the communication status.