Oil prices traded near six-week highs as geopolitical tensions in the Middle East sparked concerns about potential supply disruptions. Brent crude futures for September delivery rose 3.4% to $94.13 per barrel, while U.S. West Texas Intermediate crude futures gained 3.7% to $87.42 per barrel. Both benchmarks were on track for their fourth consecutive day of gains and stood at their highest levels since June 11.
Military operations continued to escalate the broader conflict, with U.S. forces conducting strikes against Iranian targets for an 11th consecutive night, focusing on missile and drone launch sites, command-and-control facilities, and air defense infrastructure. President Trump expressed skepticism about the likelihood of negotiations, stating the United States had “no interest in meeting” with Iran. Secretary of State Marco Rubio indicated Washington remained open to diplomatic channels while accusing Tehran of breaching a shipping agreement governing the Strait of Hormuz. Iran responded with retaliatory attacks against U.S. military positions across the region.
Shipping corridors remained a critical concern for energy markets. Yemen’s Houthi movement, backed by Iran, threatened to enforce a naval blockade targeting Saudi-linked shipping in the Red Sea, prompting some oil tankers to alter their routes. Such a development would force vessels to navigate through the Suez Canal, significantly increasing transit times and expenses for voyages to Asia. Disruptions to the Strait of Hormuz were already constraining energy flows due to ongoing hostilities.
Supply pressures extended beyond the Persian Gulf region. Kazakhstan’s crude exports through the Black Sea faced complications after the Caspian Pipeline Consortium halted oil loadings from its Russian terminal following repeated tanker attacks. Analysts noted that with disruptions spanning the Persian Gulf, threats to Saudi exports via the Red Sea, and complications in the Black Sea, current Brent pricing may not fully reflect the cumulative risks to global crude availability.
Domestically, the American Petroleum Institute reported that U.S. crude inventories increased by 2.603 million barrels in the prior week, contrary to expectations for a 1.5 million-barrel decline. The build marked the first weekly inventory increase in two weeks, and markets awaited official figures from the Energy Information Administration.
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