Hormuz Uncertainty Drives Crude Prices Higher Despite OPEC Output Hike

Crude oil prices rose on Friday due to uncertainty over the reopening of the Strait of Hormuz, a crucial waterway for global oil trade. The September WTI crude oil contract closed up 0.89 (+1.15%) and September RBOB gasoline settled up 0.0468 (+1.59%).

The proposed plan by Iran and Oman to partially restore shipping through the Strait of Hormuz is being closely monitored by the oil market. However, President Trump's statement that negotiations are 'moving along' has limited gains in crude prices.

Concerns about oil supplies from the Middle East also contributed to higher crude prices after Yemen's Houthi rebels targeted a Saudi oil tanker with a ballistic missile. Moreover, Ukraine's drone attacks on Russian oil infrastructure have intensified, with over 90% of Russian regions reporting fuel rationing or supply issues.

Despite these bullish factors, robust Chinese crude supplies and stronger Russian crude exports are adding to global oil inventories, which could weigh on prices in the near term. OPEC delegates approved a final increase of +188,000 bpd in crude production for September, with output steady for the rest of the year.