Oil prices rose sharply on Tuesday as new United States sanctions against Iran and a recovery in equity markets helped offset a steep selloff from the previous session.
Brent crude futures increased by $1.74, or 2.6%, to $68 per barrel as of 12:16 p.m. ET. West Texas Intermediate crude for May delivery rose by $1.96, or 3.1%, to $65.04 per barrel. The more actively traded June contract for West Texas Intermediate gained $1.92, or 3.1%, to $64.33.
The recovery came after the United States issued new sanctions targeting an Iranian liquefied petroleum gas and crude shipping network. Although progress was reported over the weekend in talks between Washington and Tehran over Iran’s nuclear program, no final agreement was reached. Analyst John Kilduff, partner at Again Capital, said a failure to finalize a deal could drive Iran’s oil exports to near zero.
Oil prices also received support from a rally in equity markets. According to Robert Yawger, an analyst at Mizuho, stronger risk appetite among investors helped bolster crude benchmarks after sharp losses on Monday. U.S. stocks rebounded on Tuesday after a selloff triggered by President Donald Trump’s criticism of Federal Reserve Chair Jerome Powell.
On Monday, Brent and West Texas Intermediate benchmarks fell more than 2% as optimism over U.S.-Iran negotiations and weakness in stock markets weighed on sentiment.
Despite Tuesday’s rebound, analysts warned that U.S. tariffs could continue to dampen global economic activity and oil demand. The International Monetary Fund cut its 2025 global economic growth forecast, citing century-high tariffs and rising trade tensions between Washington and Beijing.
OPEC+ reported a decline of 37,000 barrels per day in March, bringing its total oil production to 41.02 million barrels per day. The group also revised downward its forecast for global oil demand growth in 2025.
Separately, Russia’s economy ministry lowered its 2025 Brent crude price projection by nearly 17% compared to its estimate in September, according to documents seen by Reuters.
Early on Tuesday, West Texas Intermediate crude for June rose 1.38% to $63.27 per barrel at 4:40 a.m. ET, while Brent crude for June delivery increased 1.21% to $67.05 per barrel a minute later.
Meanwhile, a preliminary Reuters poll suggested that U.S. crude oil and gasoline inventories likely fell last week, while distillate inventories were expected to have risen. Official weekly data from the American Petroleum Institute and the Energy Information Administration is expected later this week.
