Middle East Tensions Offset by Tanker Flows Amid US-Iran Conflict
Oil prices fell on Friday as increased tanker movements through key Middle East shipping lanes offset supply fears tied to the US-Iran conflict. Despite the decline, both Brent and WTI were still set for a sharp monthly gain of about 20%. The Brent crude futures price dropped $1.03, or 1.2%, to $88 a barrel, while US West Texas Intermediate crude fell $1.50, or 1.8%, to $82.09 a barrel.
The Strait of Hormuz, which typically handles about a fifth of global shipments of crude oil and liquefied natural gas, has remained central to market concerns since it was largely blockaded following the February 28 start of the US-Israel war on Iran. However, analysts say that heightened tensions in the Middle East are being countered by indications of stronger flows through this waterway.
Saudi Arabia is seeking to head a coalition aimed at strengthening defence cooperation in the Bab El-Mandeb Strait, the Red Sea and the Gulf of Aden. The Saudi defence ministry said 14 countries, including Djibouti, Egypt, Pakistan, Sudan and Turkey, support the multinational maritime defence coalition.