Oil prices saw mixed results on Wednesday, with Brent crude futures rising while U.S. futures declined. This comes amid persistent uncertainty regarding crude supplies from the Middle East—the world's primary production hub—as the Strait of Hormuz remains closed.
اضافة اعلان
Brent crude futures rose by 40 cents, or 0.4%, to $95.19 per barrel by 04:20 GMT, recovering from an earlier 0.9% loss following a 4.6% drop in the previous session. Meanwhile, U.S. West Texas Intermediate (WTI) crude fell by 23 cents, or 0.3%, to $91.05, after having dropped 4.7% earlier in the session and 7.9% the day before.
Geopolitical Developments
U.S. President Donald Trump stated on Tuesday that talks to end the war between the U.S., Israel, and Iran could resume in Pakistan within the next two days. This follows the collapse of negotiations over the weekend, which led Washington to impose a blockade on Iranian ports. These remarks sparked optimism that a settlement might eventually be reached, allowing the resumption of crude and fuel flows.
Suvro Sarkar, energy sector team lead at DBS Bank, noted that while the market believes the worst phase of the U.S.-Iran conflict may be over and anticipates further peace talks, "hope is outweighing actual developments at this stage." He added that crude in the spot market continues to trade at significant premiums over futures prices.
The Strait of Hormuz Crisis
The ongoing war has led to the closure of the Strait of Hormuz, a critical waterway for the flow of crude and refined products from the Gulf to global buyers, particularly in Asia and Europe. Despite a two-week ceasefire, transit remains shrouded in uncertainty; sources reported yesterday that traffic volume is only a fraction of the approximately 130 vessels that typically traversed the waterway daily before the war. Furthermore, a U.S. official reported that a U.S. destroyer prevented two oil tankers from departing Iran.
Sanctions and Inventories
Market supply is expected to tighten further as U.S. administration officials indicated that Washington will not renew a 30-day sanctions waiver for Iranian oil at sea, which expires this week. A similar waiver for Russian oil is also set to expire this weekend.
Investors are now awaiting official U.S. inventory data from the Energy Information Administration (EIA), due at 14:30 GMT. A Reuters poll suggests U.S. crude stocks likely rose slightly last week, while distillate and gasoline inventories are expected to have declined. However, market sources citing American Petroleum Institute (API) figures indicate that U.S. crude inventories jumped for the third consecutive week.
Source: AFP
