Oil Prices Extend Gains as US-Iran War Keeps Supply Off Market
Global oil prices extended their gains on Thursday as the ongoing war between the United States and Iran continued to keep significant volumes of Iranian crude off international markets, sustaining supply tightness that has driven prices sharply higher in recent weeks. Brent crude and West Texas Intermediate both advanced in early trading, building on a multi-session rally.
The US refusal to consider an Iranian ceasefire proposal — confirmed earlier in the day — has removed the most immediate diplomatic mechanism that could have eased the supply disruption. Markets had briefly priced in a small probability of a negotiated pause; the official US rejection extinguished that expectation and pushed prices higher.
Iran remains one of OPEC's significant producers, and the removal of its output from global supply chains has created a structural deficit that other producers have only partially offset. OPEC+ members, including those outside the conflict, face pressure to increase output, though spare capacity constraints limit the pace at which supply can be restored.
For Pakistan, the sustained oil price increase represents a worsening of the import bill at a time when the country is managing a delicate external account balance under IMF oversight. Higher fuel costs will feed into electricity generation pricing, transportation, and inflation more broadly, putting additional pressure on already stretched household and government budgets.
