Oil prices have risen as the prospect of a lasting truce between the US and Iran was clouded after peace talks in Switzerland were called off and as Israel stepped up attacks on Lebanon, Reuters reports.

By 11:45am PKT, Brent crude futures gained 51 cents, or 0.64pc, to $80.36 a barrel, and US West Texas Intermediate crude rose $1.28, or 1.7pc, to $77.88 a barrel, with the front-month July contract expiring on Monday. Both contracts were headed for a weekly loss of about 8pc.

The more actively traded WTI August contract was up 59 cents at $76.44 a barrel.

“Prices may have bottomed out and we may see a renewed climb accompanied by plenty of volatility as cracks have already emerged in the memorandum of understanding,” said Vandana Hari, founder of oil market analysis provider Vanda Insights.

“This is not the geopolitical backdrop that would give the market any confidence in resuming Hormuz transit.”