(RTTNews) – Crude oil prices are modestly higher on Thursday, giving back initial gains that reflected increasing supply disruption concerns amid U.S.-Iran re-escalation after U.S. President Donald Trump remarked that the new wave of strikes on Iran are only for a limited time.
WTI Crude Oil for October month delivery was last seen trading up by $0.24(or 0.26%) at $91.26 per barrel.
The U.S. military recently commenced a second round of strikes on Iran, targeting Iran’s radar system and mine-laying capabilities along Iran’s southern coast.
After pausing attacks on Iran for more than a month, the U.S. Treasury Department announced an economic blockade on Iran and warned that any nation that offers a helping hand to Iran would suffer the same fate.
Experts were of the view that the U.S. switched to economic measures against Iran as opposed to its earlier military maneuvers and hence anticipated no war in the Middle East.
Quashing the expectations, over the last weekend, U.S. forces launched strikes to disable Iran’s launchers on Larak Island which were apparently readying to lay mines across the Strait of Hormuz. In retaliation, Iran targeted two U.S. bases in Jordan.
Displeased by Iran’s moves, Trump vowed to strike back Iran fiercely, prompting the second round of attacks.
Two locations in Iran’s southwestern Khuzestan province, Ahvaz and Aghajari, were hit in the U.S. missile attacks.
Iran claimed attacking the U.S. bases in Jordan, Bahrain, Kuwait, and Erbil province of Iraq.
Yesterday, speaking to reporters, Trump remarked that the bombing campaign on Iran might not happen for too long, hinting that the renewed attacks could be short-lived but added that the U.S. can hit Iran anytime if needed.
Iran’s foreign ministry called on its regional neighbors to stop letting the U.S. use their facilities and territory to carry out attacks on Iran.
Ship-tracking firm Kpler reported that on Monday, traffic across the Strait of Hormuz sharply declined with only five ships transiting the strait.
However, in an interview with CNBC, U.S. Energy Secretary Chris Wright stated that more than 17 million barrels of oil passed through the critical waterway on Monday.
Trump has been claiming that the Strait of Hormuz is fully under the control of U.S. forces and ships are freely moving in and out, protected by the U.S. navy but undetected by commercial shipping trackers. Yesterday, he suggested renaming the Strait of Hormuz as the Trump Strait.
With the strait remaining shut, crude oil prices received upside support due to supply concerns.
Today, citing Kpler’s data, Reuters reported that six cargo ships traveled through the strait on Wednesday, down from 11 of the previous day, well-below the 10-day average of around 13. Through the Bab el-Mandeb Strait, 31 cargo ships made transit.
Iran had warned that all ships transiting through the strait must comply with its regulations and coordinate with the Iranian military failing which they would come under attack.
Yesterday, Saudi Arabia stated that a state-owned oil tanker came under attack, which killed two crew members.
In an interview with Bloomberg published today, the Chief Executive of Mitsui OSK Lines, the world’s largest tanker operator, speculated that the shipping disruptions at the Strait of Hormuz could continue for longer than expected with no normalization to be seen by the end of 2026.
Yesterday, citing three sources, Reuters reported that the Organization of Petroleum Exporting Countries is likely to hold its oil output steady when seven of its core member nations meet on Sunday.
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