The countdown is on and the American delegation hasn’t even entered the air. With the U.S.-Iran ceasefire set to expire overdue Wednesday, Tuesday’s news from both sides resembled a pre-conflict posture rather than pre-deal diplomacy, culminating with the news that Vice President J.D. Vance’s trip to Islamabad had been put on hold.
Trump’s ultimatum, not an olive branch
President Donald Trump used a Tuesday interview with CNBC to tell Wall Street he had no desire to extend it. The president said time was running out, cited a favorable agreement as the likely outcome, and made clear the military was ready to resume operations, describing the U.S. posture as “no action anytime soon.” Earlier on Truth Social, Trump accused Iran of repeatedly violating the ceasefire. However, the US side looked less coordinated than the rhetoric suggested. Vance, special envoy Steve Witkoff and Jared Kushner were scheduled to leave for Islamabad on Tuesday morning for a second round of Pakistan-brokered talks after a 21-hour session earlier this month that failed to produce any agreement. That flight was postponed because Iran’s leaders were divided on whether to take part, and the attack was reportedly linked to the ongoing U.S. naval blockade of Iranian ports. Secretary of Defense Pete Hegseth and Secretary of State Marco Rubio were seen at the White House for policy meetings as the delegation sat idle.
Tehran is sizzling on its heels
Iran’s message on Tuesday did little to soften its tone. Foreign Minister Abbas Araghchi told his Pakistani counterpart Ishaq Dar that Tehran was still considering options while Iran’s Foreign Ministry was deadlocked over what he called Washington’s provocative actions, including Sunday’s seizure of the Iranian merchant ship Touska. Speaker of Parliament Mohammad Bagher Ghalibaf intensified his actions, warning on Program X that Trump was trying to turn the negotiations into a “surrender table.” Foreign Ministry spokesman Esmaeil Baghaei added that Tehran’s reluctance reflects contradictory U.S. behavior, not indecision.
Markets stop pricing the transaction
West Texas Intermediate (WTI) futures rose 4% to above $93 a barrel, while Brent futures rose 2% above $98, repeating most of last week’s decline on initial ceasefire optimism. Dow Jones Industrial Average (DJIA) futures, which hit an overnight high near 49,800, have recovered to near 49,400 as crude oil prices rise and Treasury yields strengthen. Only 16 ships passed through the Strait of Hormuz on Monday, according to MarineTraffic data, a reminder that the waterway, which usually carries about 20% of global oil flows, remains closed.
What happens if time runs out?
With Vance still in Washington and Iran yet to confirm the delegation, the diplomatic runway is rapidly shrinking. Trump sees no reason to extend it, and Tehran will not negotiate under energetic military threat. Pakistan continues to push both sides back to the table. If this approach fails in the next 24 hours, the Strait of Hormuz and the oil elaborate will be the first places to see markets decline.
WTI 5-minute chart
Frequently asked questions about WTI crude oil
WTI Oil is a type of crude oil sold on international markets. WTI stands for West Texas Intermediate, one of three main types, including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” due to its relatively low weight and low sulfur content. It is considered a high-quality oil that can be easily refined. It originates in the United States and is distributed through the Cushing Junction, considered the “Crossroads of the World.” It is a reference point for the crude oil market, and the WTI price is often quoted in the media.
Like all assets, supply and demand are key factors influencing the price of WTI crude oil. Therefore, global growth may drive increased demand and, conversely, frail global growth. Political instability, wars and sanctions can disrupt supply and affect prices. Another key factor shaping prices are the decisions of OPEC, the group of major oil-producing countries. The value of the US dollar affects the price of WTI crude oil because oil is mainly sold in US dollars, so a weaker US dollar can make oil more affordable and vice versa.
Weekly crude oil inventory reports released by the American Petroleum Institute (API) and the Energy Information Administration (EIA) influence the price of WTI crude oil. Inventory changes reflect fluctuations in supply and demand. If the data shows a decline in inventories, it may indicate increased demand, which will result in an raise in the price of oil. Higher inventories may reflect increased supply, which causes prices to fall. The API report is published every Tuesday and the EIA report the following day. Their results are usually similar and are within 1% of each other 75% of the time. EIA data is considered more reliable because it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 oil-producing countries that jointly decide on production quotas for member countries at meetings held twice a year. Their decisions often influence the prices of WTI crude oil. When OPEC decides to cut quotas, it can tighten supply, which will push up oil prices. OPEC increasing production has the opposite effect. OPEC+ refers to an expanded group that includes ten additional non-OPEC members, the most notable of which is Russia.
