Oil gains on Middle East supply concerns amid impasse in US-Iran war
Oil prices climbed on Thursday on concerns that the impasse in the US-Israeli war against Iran will continue to disrupt supply from the key Middle Eastern producing region and tighten global supplies.
Brent crude futures for October delivery rose 35 cents, or 0.38%, to $91.97 a barrel by 06:32 GMT, while US West Texas Intermediate crude futures for September added 17 cents to $86.00 a barrel.
The more-active October WTI contract was up 38 cents, or 0.45%, to $84.77.
Both Brent and WTI benchmarks gained for a fifth straight session on Thursday, having settled on Wednesday at their highest since July 24. The September WTI contract expires later on Thursday.
“ Oil prices remained elevated as the market is supported by sporadic attacks in the Middle Eas t but lacks fresh momentum without a major escalation,” said Hiroyuki Kikukawa, chief strategist of Nissan Securities Investment, a unit of Nissan Securities.
“The market is likely to maintain a gradual upward trend given uncertainty over peace talks and tensions involving the United Arab Emirates, Oman and Iran,” he added.
The UAE’s decision to suspend all financial and economic transactions with Iran until further notice has refocused the spotlight on fraught ties between the major Gulf Arab oil producer and Iran.
On Tuesday, US President Donald Trump said no talks were taking place with Iran and that the Strait of Hormuz was open. Iran, however, said the waterway remained shut.
Shipping traffic through the Strait of Hormuz on Wednesday was unchanged from the day before as discussions to end the war between the United States and Iran remained deadlocked, according to the latest shipping data.
Before the war that began on February 28, shipments equal to about one-fifth of global consumption moved through the waterway. Current flows are far below pre-war levels.
The war has also impacted the supply of refined fuels and drawn down inventories, with less crude available to refiners.
Brent crude was up around 6% last week, and there is plenty for traders to think about as the new week begins.
US stockpiles of distillate fuel, including diesel and heating oil, fell last week for a third week, the Energy Information Administration said on Wednesday.
However, crude inventories rose by 4.4 million barrels in the week ended August 14, compared with estimates for a 600,000-barrel draw.
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