Market News

(Bloomberg) -- Oil held near a six-month high, after President Donald Trump warned Iran had 15 days at most to reach a deal over its nuclear program as the US assembles a vast array of forces in the Middle East.

Brent traded above $71 a barrel, on course for a weekly gain of about 5%, while West Texas Intermediate traded near $66. Trump said he thought 10 to 15 days were about the “maximum” he would allow for negotiations to continue, raising concerns about a conflict and potential disruptions to oil supply.

The US is carrying out the biggest military buildup in the Middle East since 2003, before the invasion of Iraq. That suggests Trump may launch a far more sweeping campaign than the overnight attack against Iran’s nuclear program last June. The president is also weighing a limited initial strike designed to drive Tehran to the negotiating table, the Wall Street Journal reported.

“We still think this is Trump piling on the pressure rather than about to pull the trigger,” said Robert Rennie, head of commodity research at Westpac Banking Corp.

The OPEC member pumps more than 3 million barrels a day of crude, or about 3% of global output, and mainly exports to China. However, the main risk for oil prices is if Iran decides to blockade the Strait of Hormuz, a key conduit for energy exports from Persian Gulf producers.

Oil has surged by about a sixth so far this year as traders gauge the risks to supplies from the region, which have eclipsed expectations of a building surplus that had weighed on prices at the end of 2025. A sustained campaign against Iran could see prices jump further, which would feed through to gasoline costs at the pump and risk angering US voters ahead of midterm elections later this year.

Iran’s window to reach a diplomatic agreement over its atomic activities is at risk of closing, according to the head of the United Nations nuclear watchdog.

Oil timespreads are reacting to the increased risk. Brent’s one-year spread moved to the widest backwardation — a market structure that signals tighter near-term supply — since June. The six-month gap has also pushed further into backwardation. Options skews for both Brent and WTI are in a deeper bias toward bullish calls, signaling rising expectations for price gains.

Adding to the bullish momentum, US crude stockpiles fell by about 9 million barrels, the biggest drop since early September, figures from the Energy Information Administration showed. Oil product inventories also declined across the board.