Global oil prices moved higher on Thursday after renewed diplomatic engagements between the United States and Iran fueled shifts in market sentiment, even as uncertainty lingered over shipping through the Strait of Hormuz.

West Texas Intermediate (WTI) crude traded near $92 per barrel, while Brent crude climbed above $95, recovering from earlier declines as traders reassessed geopolitical risk.

The gains came after reports that officials from both Washington and Tehran are considering extending a temporary ceasefire to allow more time for negotiations. Plans for another round of talks, possibly in Pakistan, have raised hopes that progress could be made in reducing tensions that threaten key energy supply routes.

Despite these diplomatic efforts, the Strait of Hormuz – a narrow waterway carrying a large portion of the world’s oil exports remains effectively restricted. A US naval blockade targeting Iranian ports continues to limit commercial maritime traffic, and some Iran-linked vessels are still reported to be moving through the waterway, leaving traders unsure how much oil is actually being shipped.

Tehran has warned that prolonging the blockade could spark wider disruptions across the Persian Gulf and nearby seas, adding a risk premium to prices. Meanwhile, the US Department of Defense has plans to send additional troops to the region, and Israeli airstrikes in southern Lebanon illustrate how tensions extend beyond a single front.

Oil markets remained volatile, with investors closely watching for signs that talks might lead to a reduction in supply disruptions or a reopening of the Hormuz route. Any breakthroughs in the negotiations or progress in regional diplomacy could quickly shift prices in the coming days.