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Oil prices have climbed higher amid fading hopes of deescalation in the Iran war following Tehran’s denial that talks with the United States are under way.Futures for Brent crude, the international benchmark, rose nearly 2 percent on Thursday to top $104 per barrel after Tehran dismissed reports of direct negotiations with US President Donald Trump’s administration.The rise comes after oil prices eased on Wednesday following reports that Trump had shared a 15-point plan for ending the war with Iran.Iranian Foreign Minister Abbas Araghchi said in an interview with state media aired on Wednesday that Tehran was not engaged in direct talks with Washington and has “no intention of negotiating for now”.White House Press Secretary Karoline Leavitt warned on Wednesday that Iran would be “hit harder” than ever before if Tehran did not accept military defeat.Iran’s effective closure of the Strait of Hormuz, a conduit for one-fifth of global oil supplies, and its attacks on energy facilities across the Middle East have prompted a surge in energy prices worldwide.Oil prices are up more than 40 percent compared with before the US and Israel launched strikes on Iran on February 28, prompting numerous countries to implement fuel rationing and other energy conservation measures.Market-watchers say prices are likely to rise further until shipping is free to traverse the strait, despite efforts by countries to bolster supply by tapping emergency stockpiles in coordination with the International Energy Agency.While Tehran has repeatedly claimed that the strait is open to ships that are not aligned with its enemies, daily transits have all but collapsed since the start of the conflict.Four vessels were tracked transiting the waterway via their automatic identification systems on Tuesday, down from an average of 120 daily transits before the conflict, according to maritime intelligence firm Windward.

Europe is bracing for a potential energy crisis, with fuel rationing possible as early as April if the Strait of Hormuz, a critical passage for oil and gas supplies, remains closed. Shell's CEO, Wael Sawan, issued this stark warning at a major oil industry conference in Texas, highlighting the escalating risks to global energy supplies.The crisis, now in its fourth week, has already led to energy rationing in Asian countries and significant price hikes for jet fuel, which has doubled in price since the start of the conflict. Sawan predicts that diesel and petrol will come under pressure next, particularly as the summer driving season begins in the US and Europe.Oil prices have fluctuated, dipping back to about $100 a barrel on Wednesday after reaching highs of around $114 earlier in the week. These developments have raised concerns about the potential for a prolonged global economic recession if oil prices continue to rise, with some predictions suggesting they could hit $150 a barrel.Larry Fink, CEO of BlackRock, the world's largest asset manager, warned of profound implications for the world economy if the conflict continues to drive up oil prices. He outlined two possible scenarios: one where the conflict resolves quickly, allowing oil prices to return to pre-crisis levels of about $70 a barrel, and another where prices remain high for years, potentially leading to a stark and steep recession.Germany's economy minister, Katherina Reiche, also spoke at the conference, cautioning that energy supply scarcity could occur in late April or May if the conflict continues. She criticized Germany's decision to phase out nuclear energy and emphasized the need for greater imports of gas via super-chilled tankers from overseas.

The ongoing conflict between the US and Iran has significant implications for the UK economy, with the potential to plunge the country into a severe energy crisis. The Strait of Hormuz, a critical shipping lane for oil, is now rendered unsafe due to Iranian drones and mines, threatening to disrupt global fuel supplies. Historically, the UK has faced similar challenges, such as during the Suez crisis 70 years ago, when petrol rationing was introduced. Former BP executive Nick Butler warns that if the crisis persists, the UK could be just weeks away from needing to ration fuel, with critical users like emergency services being prioritized. The economic consequences of such a crisis are far-reaching. A sustained energy crisis could push up average British household energy bills by £500, according to the Resolution Foundation thinktank. This would further exacerbate the cost of living crisis, which has already seen inflationary shocks and a backlash against incumbents. The UK government faces difficult decisions. Chancellor Rachel Reeves has already taken steps to help 1.7 million households reliant on oil for heating and hot water, whose bills have doubled. However, her warning that financial help will be targeted at lower earners suggests that harder decisions lie ahead. In the long term, the UK must consider investing in net zero initiatives to reduce dependence on fossil fuels. Modelling by the government's expert Climate Change Committee suggests that if Britain sticks to its net zero path, even a substantial oil shock would raise energy bills by only 4% by 2040. However, implementing such policies in the midst of a crisis is a challenging task.