Crude oil prices rebounded on May 7. This movement reversed a sharp decline recorded on May 6. Optimism for an imminent peace deal between the U.S. and Iran faded.
Iranian officials dismissed a U.S. proposal as a wish list. President Trump described recent diplomatic talks as very productive. The U.S. Central Command seized an Iranian-flagged vessel, threatening the reopening of the Strait of Hormuz.
Global benchmark Brent crude rose back above $100 per barrel. West Texas Intermediate prices also climbed. The market is now pricing in a higher risk of continued supply disruptions.
Energy stocks and ETFs like VDE rose following a sharp decline on May 6. Diplomatic negotiations remain the primary driver for the sector's performance.