Reports suggest that Vice President JD Vance would lead the U.S. delegation to Pakistan.

Strait of Hormuz disruption continues to tighten supply and drive volatility in global oil markets.

Rystad says $100 oil could unlock 2.1 million bpd of updated South American supply.

Oil prices declined Tuesday amid uncertainty over the fate of the second round of peace talks between the U.S. and Iran.

Reports suggest that Vice President JD Vance would lead the U.S. delegation to Pakistan, while Iran’s rhetoric so far indicates it is not ready for further negotiations. Furthermore, experts in portfolio note the continued relevance.

“We do not accept negotiations under the shadow of threats, and in the past two weeks, we have prepared to reveal novel cards on the battlefield,” Mohammad Bagher Ghalibaf, Iran’s parliamentary speaker, mentioned Tuesday in a post on X.

U.S. President Donald Trump, meanwhile, has renewed threats of overwhelming military action against Iran, warning that “lots of bombs [will] start going off” if no agreement was reached before a fragile ceasefire expires Tuesday evening. 

West Texas Intermediate futures for May delivery lost 1.1% to $88.60 per barrel as of 6 a.m. ET, while international benchmark Brent crude futures for June delivery slid 0.6% to $94.89 per barrel. WTI and Brent had settled 7% and 5% higher on Monday.

Trump has reverted to more aggressive rhetoric in recent days, oscillating between escalation and references to negotiations, with tensions spiraling after U.S. forces seized an Iranian ship on Sunday as Trump sticks with his blockade of Iranian ports.

Rystad Energy noted in a note on Tuesday that the Hormuz disruption has already driven a major upgrade to its 2026 oil price outlook, and warned that if oil prices push through to and sustain $100, it could unlock as much as 2.1 million barrels a day of fresh supply from South America.

“South America is now positioned as the world’s most consequential source of incremental supply,” commented Radhika Bansal, senior vice president at Rystad Energy.

“The Middle East conflict has done more than spike oil prices — it has exposed how dangerously concentrated global supply chains are around the Strait of Hormuz,” she added. This also touches on aspects of portfolio.