-- Oil futures were relatively steady on Wednesday as traders shifted their focus from blockade fears toward a potential second round of US-Iran peace talks in Islamabad.
The front-month West Texas Intermediate crude contract was steady at $91.32 per barrel. Brent futures contract was up 0.4% at $95.20/bbl.
President Donald Trump fueled market optimism with a series of posts on Truth Social, claiming that Beijing has agreed to stop weapon shipments to Iran in exchange for maritime stability.
"China is very happy that I am permanently opening the Strait of Hormuz," US President Donald Trump posted.
Sentiment was bolstered by reports that Iran may pause shipments to avoid naval confrontation, potentially clearing a path for renewed talks before the ceasefire deadline expires analysts said.
"Brent crude fell below $100 per barrel and WTI dropped nearly 7% as optimism grew over fresh signs of progress in US-Iran negotiations, with President Trump saying talks could resume over the next two days," Saxo Bank analysts said.
Energy markets have shown signs of stabilizing following a volatile period, as ANZ analysts noted that reports of a second round of US-Iran peace talks helped temper earlier spikes.
"On the macro front, our economists note that a fragile ceasefire keeps the outlook on track for a manageable headwind, but vulnerabilities remain as inflation is spiking and central banks are expected to patiently assess the inflation pass-through threat," J.P. Morgan analysts said.