(RTTNews) – Rebounding from yesterday’s losses, crude oil prices have soared on Friday after Iran’s military claimed conducting strikes on U.S. military assets in Bahrain and Kuwait. In addition, Iran fired at two U.S.-backed vessels transiting through the Strait of Hormuz.
WTI Crude Oil for September month delivery was last seen trading up by $1.48 (or 1.77%) at $85.07 per barrel.
Fading expectations of a diplomatic resolution to the U.S.-Iran crisis brought back the risk premium to crude oil prices.
Yesterday, crude oil prices slid due to the positivity induced from Oman-Iran talks over the management of the Strait of Hormuz. Iran and Oman exchanged proposals regarding the future management of the Strait of Hormuz.
Oman presented the idea of a joint regional mechanism with a voluntary fee collection. However, rejecting the proposal, Iran offered a counter-proposal. Not willing to concede its control over the seaway, Iran is more inclined to collect a fee from all ships.
Market participants anticipated the possibility of an earlier resumption of tanker traffic through the Strait of Hormuz.
Reigniting tensions today, Iran’s Islamic Revolutionary Guards Corps claimed that it conducted strikes on several U.S. military assets across Bahrain and Kuwait.
The war between the two nations which started on February 28 halted briefly after a Memorandum of Understanding was signed between the U.S. and Iran to end their mutual attacks.
In less than a month, both nations adopted military offensives, with the U.S. continuing to attack Iran for 13 consecutive nights.
Last Friday, U.S. President Donald Trump revoked his plans to massively strike Iran and ordered U.S. forces to halt attacks. Days later, Trump stated that he paused the strikes to allow diplomacy one more chance.
However, the brief ceasefire lasted only four days. After Iran launched hits at Jordan targeting U.S. bases, U.S. forces retaliated.
Allowing negotiations with Iran to continue on the one hand, Trump stated that he wanted Iran to be hit harder.
Yesterday, U.S. Central Command announced completing a heavy wave of strikes against various Iranian targets causing extensive damages.
After claiming to have struck the Sheikh Isa Air Base in Bahrain yesterday, today, the IRGC targeted the Ahmad al-Jaber Air Base in Kuwait.
Further, the Iranian military claimed striking two U.S.-backed tankers attempting to transit via the strait and forced four others to turn back.
Data from Kpler revealed that as of July 29, 14 commodity vessels crossed the strait in both directions.
Following the latest attacks, oil prices moved on the higher side.
On a monthly basis, along with the Brent Crude, the West Texas Intermediate gained nearly 20%.
Late Thursday, Trump announced the success of a U.S.-brokered ceasefire agreement between Israel and Hamas.
The deal mandates complete disarmament by Hamas as well as other armed groups in Gaza, while Israel will withdraw all its troops once Hamas completely lays down its arms.
The deal was coordinated by the U.S. with mediatory support from Egypt, Qatar, and Turkey.
Today, Trump is set to meet with his cabinet in Camp David to discuss the ongoing conflict with Iran and the rise in gasoline prices among other issues.
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