Oil jumps 5%; Brent closes above $95

Oil tank

Oil closed higher today, April 20, driven by fears that the fragile ceasefire between the US and Iran could collapse, following the seizure of an Iranian cargo ship by US forces and the continued near-complete halt to shipping through the Strait of Hormuz.

Brent crude futures for June delivery rose 5.64%, or $5.10, to $95.48 a barrel. WTI crude oil futures for May delivery rose 6.87%, or $5.76, to $89.61 a barrel.

This rise offsets some of the sharp losses during the April 17 session, when prices plummeted by 9% after Tehran announced the opening of the Strait to commercial ships, and US President Donald Trump stated that Iran had agreed not to close this vital shipping lane.

But tensions escalated again after Washington announced on Sunday that it had intercepted an Iranian cargo ship that tried to break the blockade, which was met with an Iranian threat to retaliate, reinforcing fears of a resumption of full-scale hostilities.

While Tehran is considering participating in peace talks without yet announcing a final decision, Trump expressed doubts about the possibility of extending the truce. He, however, predicted that a peace agreement with Iran would be reached tonight, confirming that an American delegation is heading to Islamabad to hold a round of talks.