Gulf Tensions Push Brent Crude Towards $98 Amid Hormuz Disruptions
Crude oil prices reversed their early losses on Thursday as tensions in the Gulf escalated, pushing Brent crude towards $98. The attacks on Kuwait by Iran and threats from Israel's defense minister created concerns about supply disruptions through the Strait of Hormuz.
The number of vessels transiting the strait dropped to six on Wednesday, down from 11, which increased fears about potential shortages in the crude oil trade. However, Iraqi exports are rising, but they depend on Iranian approval, highlighting the country's influence over Gulf supply.
Traders had attempted to take profits after a three-session surge of 8% to 9%, with some expecting the fighting to be brief. Trump said 'the fighting would not last too long', which may have contributed to the initial decline in oil prices. However, the situation took a turn for the worse when Kuwait came under Iranian missile and drone fire on Thursday morning.