Oil prices rose on Wednesday on supply concerns triggered by declining prospects of an Iran deal while an estimated increase in US crude oil inventories capped further price upticks, raising demand woes.

International benchmark Brent crude traded at $92.91 per barrel at 10.09 a.m. local time (0709 GMT) for a 2.53% increase from the closing price of $90.62 a barrel in the previous trading session.

American benchmark West Texas Intermediate (WTI), trading at $86.17 per barrel at the same time, gained 2.66% after the previous session closed at $83.94 a barrel.

The EU’s foreign policy chief Josep Borrell on Tuesday said he does not expect a breakthrough in reviving the Iran nuclear deal this week.

On the margins of the opening of the UN General Assembly in New York, Borrell responded to inquiries on reaching a final compromise on the draft he presented in August to revive the 2015 Iran nuclear deal.

Borrell said he does “not expect that anything will happen during this week” after the parties “made some proposals that were certainly not contributing to look for a final result.”

At the same time, he stressed, that they were and “are still close” to getting a final result because he does “not see a better solution than the one we have proposed.”

The Iran nuclear deal – officially called the Joint Comprehensive Plan of Action (JCPOA) – was signed in 2015 by Iran, the US, China, Russia, France, UK, Germany, and EU.

Under the agreement, Tehran committed to limit its nuclear activity to civilian purposes and in return, world powers agreed to drop their economic sanctions against Iran.

Under former President Donald Trump, the US unilaterally withdrew from the agreement in 2018 and re-imposed sanctions on Iran, prompting Tehran to stop complying with the nuclear deal.

In August, Borrell presented a proposal on lifting US sanctions while ensuring Iran’s compliance with nuclear requirements.

Demand woes cap further gains

Lingering fears of a global recession leading to weak oil demand further increased after the American Petroleum Institute (API) announced late Tuesday its estimate of a rise of over 1 million barrels in US crude oil inventories, relative to the market expectation of a 2.3 million-barrel fall.

Significant inventory increases signal declines in US crude demand, assuaging market concerns over weak demand.