Oil prices today: Oil trades sideways as traders look for Middle East peace deal

Oil traded sideways at $US98.50 a barrel on Thursday morning as traders digested news that Iran has rejected a 15-point US ceasefire offer and laid out its own list of conditions to end the Middle East war.

The mixed headlines left the S&P/ASX 200 trading flat on Thursday morning at 8533 points as gains in the energy sector were offset by another day of steep falls across technology businesses. The top performer on the flagship index was drone security player Droneshield, up 7.5 per cent to $4.58 despite it releasing no news to the market.

Wall Street traded slightly higher as investors hedged their bets on the likelihood of the war escalating into next week as the US sent up to 4000 additional marines to the region. European shares gained with the UK’s FTSE 100 up 1.4 per cent.

Early on Thursday morning President Trump’s Press Secretary Karoline Leavitt said her boss does not bluff and is prepared to “unleash hell” on Iran if it does not agree to his ceasefire conditions including a deal to reopen the Strait of Hormuz to shipping.

“A senior Iranian official said Iran had rejected a US proposal to end the war,” said National Australian Bank. “The US proposal called Tehran to dismantle main nuclear sites, fully open the Strait of Hormuz and use a reduced missile arsenal in self-defence only. Iran has set out conditions of its own, including reparations, recognition of authority to collect fees from ships transiting the Strait of Hormuz and lifting of all sanctions.”

Local shares are seeking to avoid a fourth straight week of losses stoked by fears an energy supply shock will force interest rates as high as 4.85 per cent later this year. On Wednesday headline inflation for February reached 3.7 per cent and the Reserve Bank has warned it expects price rises to climb further later in 2026.

Gold prices also edged higher to $US4515 an ounce to claw back three weeks of heavy losses since the war erupted on February 27.