Brent ​futures settled up $1.81, or 1.89 per cent, at $97.81 a barrel

Oil prices rose nearly 2 per cent on Wednesday, extending the previous session’s gains, as hostilities in the Middle East erupted anew and talks between Tehran and Washington showed little progress.

Brent ​futures settled up $1.81, or 1.89 per cent, at $97.81 a barrel.

The chances of a ceasefire seem to be deteriorating, said Bob Yawger, director of energy futures at Mizuho. That’s the wrong direction we are moving in.

Crude prices continue to solidify their upward trajectory as accelerating clashes between the United States and Iran outpace stagnant diplomatic efforts, Simon-Peter Massabni, head of business development at XS.com, said in a note.

The prolonged closure of the Strait of Hormuz continues to bottleneck global energy supplies, driving sustained ​upward pressure on oil markets, he added.

The International Energy Agency’s warning that global oil inventories could hit critical levels ahead of ‌peak summer demand if stock draws continue at their current pace added to the bullish sentiment.

The stalling in the US-Iran negotiations and IEA warnings of critical global low stock levels are adding upward layers in risk premium ​in benchmark prices, ‌said Emril Jamil, a senior analyst for oil at LSEG.

US crude inventories dropped on strong export and refining demand as the ‌US war with Iran entered its fourth month.

US crude stockpiles declined by 8 million barrels to 433.7 million barrels in the week ended May 29, the country’s energy department said on Wednesday.

Another large draw in US crude inventories, driven by both a drop in commercial and strategic inventories, said Giovanni Staunovo, analyst with UBS.