By: OrePulse

Brent crude rose 2.47% to $96.96 a barrel by 7:11pm UAE time on Thursday, rebounding after touching a two-month low a day earlier, with prices continuing to track developments tied to the conflict involving Iran in the Gulf region. Brent had gained more than 3% earlier in the session before paring some of that advance.

West Texas Intermediate crude climbed 2.02% to $89.90 a barrel over the same period. Brent, the benchmark used to price about two-thirds of the world's oil, had briefly dropped below $93 a barrel on Wednesday, its lowest level in two months. Both benchmarks have pared their losses for the week to about 14%, after a sharp selloff earlier in the week.

Ole Hansen, head of commodity strategy at Saxo Bank, said in a market note that there is no peace agreement between the United States and Iran, leaving prices "vulnerable to renewed volatility" tied to what he called "binary geopolitical risks." He said the recovery in Middle East crude oil exports has outpaced improvements in refined fuel supplies from the region. Hansen added that the pullback in crude prices after this week's U.S. midterm elections, in which the Democratic Party won majorities in the House of Representatives and the Senate, had provided some relief after months of elevated energy costs.

Iran's navy said Thursday that an oil tanker east of the Strait of Hormuz struck a mine and caught fire. The navy said the vessel had been operating in what it called an "unsafe zone," in breach of maritime regulations.

Saudi Arabia has continued to face missile attacks from Yemen's Houthi movement amid the wider regional conflict.

Iran's Foreign Minister, Abbas Araghchi, held separate phone calls with his Saudi counterpart, Prince Faisal bin Farhan, and his Qatari counterpart, Sheikh Mohammed bin Abdulrahman, to discuss regional developments and diplomatic efforts toward regional stability, Iran's semi-official Tasnim news agency reported.

Paul Donovan, chief economist at UBS Global Wealth Management, said oil prices still have room to fall once the conflict ends. "A fundamental fair value for the oil price is probably around $80, $85 a barrel," he said, adding that prices would eventually "settle" at that level "in a postwar environment."