Oil Prices Defy Expectations Ahead of Central Bank Meetings

The price of crude oil has defied expectations of sharper rises, and its future trajectory will be crucial in the coming weeks as several G10 central banks prepare to meet. Every G10 central bank is scheduled to convene in September, with most expected to potentially raise interest rates.

Despite the New York Times suggesting that US diplomats may return to the Middle East, which could have led to lower oil prices, developments yesterday saw some of this drop reverse. The Iran-Oman deal to secure the Strait of Hormuz was seen as a defiant move by Iran, potentially drawing a response from the US.

US Energy Secretary Chris Wright claimed that the US army helped ship over 15mn barrels through Hormuz in a single day last week, with an average of more than 8mn barrels a day. However, tracking data suggests this may be an exaggeration, but untracked ships could contribute to higher traffic.