Oil climbs on Iran dismisses U.S. negotiations

March 26, 2026 (MLN): Global oil prices edged higher on Thursday after Iran signaled it is not willing to engage in direct negotiations with the United States, dampening hopes for a swift resolution to ongoing geopolitical tensions.

Currently, Brent crude futures went up by $2.31, or 2.26%, to $104.53 per barrel, according to data by Mettis Global.

West Texas Intermediate (WTI) crude futures increased by $2.06, or 2.28%, to $92.38 per barrel by [11:12 am] PST.

Speaking to state media, Iranian Foreign Minister Abbas Araghchi clarified that indirect communication through intermediaries should not be interpreted as formal negotiations with Washington, as reported by CNBC.

His remarks came amid reports that Tehran is reviewing a U.S. proposal aimed at ending the conflict, while simultaneously preparing its own set of conditions.

Iranian state outlets further indicated that the country is likely to reject the U.S.-backed ceasefire framework, reinforcing uncertainty over diplomatic progress. The contrasting narratives from Tehran and Washington have added to market volatility, particularly in the energy sector.

Earlier this week, U.S. President Donald Trump stated that negotiations between the two countries were already underway, suggesting that Iran was inclined toward a deal.

He also noted that the U.S. had reconsidered potential strikes on Iranian energy infrastructure in light of ongoing diplomatic efforts.

However, Iranian officials have consistently denied any direct engagement, highlighting a widening communication gap between the two sides.

The geopolitical developments have contributed to upward pressure on oil prices, as traders factor in the risk of prolonged supply disruptions in the region.

Despite the surge in energy prices, analysts at TD Securities believe the shock is unlikely to prompt an immediate shift in U.S. monetary policy.

While markets have started pricing in the possibility of interest rate hikes due to rising inflation expectations, the Federal Reserve is expected to adopt a cautious stance.

According to the bank, policymakers are likely to remain in a “wait-and-see” mode, with a continued inclination toward potential rate cuts later in 2026.

The Fed is expected to look past temporary energy-driven inflation, provided long-term expectations remain stable and broader price pressures do not escalate.

As geopolitical tensions persist and mixed signals on diplomacy continue, oil markets are expected to remain sensitive to any developments surrounding U.S.-Iran relations, keeping investors on edge in the near term.

Copyright Mettis Link News