Brent Crude Soars as Strait of Hormuz Traffic Remains Disrupted

Oil prices are once again on the rise, and experts believe Brent crude could reach US$110 per barrel. As of Thursday morning, Brent was trading at approximately US$102.92, while West Texas Intermediate (WTI) is changing hands at US$92.26.

The global benchmark has gained around 11.7% over the past month and more than 48% over the past year, according to Trading Economics. With US$110 less than 7% away, oil traders are on edge due to ongoing supply disruptions in the Middle East.

Shipping through the Strait of Hormuz is still a long way from normal, with just 3 commodity vessels passing through the waterway on Tuesday compared to an average of 15 per day. Saudi Arabia has restarted its East-West oil pipeline, but operations have only resumed at reduced capacity and it may take another 6-8 weeks for the pipeline to be fully operational again.

US oil inventories rose unexpectedly last week, with crude stocks increasing by 3 million barrels to 426.4 million barrels. However, fuel stockpiles fell, with gasoline stockpiles down by 1.7 million barrels and distillate inventories declining by 400,000 barrels.