Oil Prices Hold Steady Amid Hormuz Strait Disruptions

International oil prices held steady on Monday as the market balanced supply disruption risks in the Strait of Hormuz against weak global demand. Brent crude for October delivery rose 20 cents, or 0.2%, to $88.72 a barrel, while New York-traded September WTI slipped 5 cents, or 0.1%, to $82.35.

The recent attacks on tankers operated by Abu Dhabi National Oil Company (ADNOC) and strikes on Saudi Aramco refining facilities have pushed geopolitical risk premiums back to the forefront of oil market dynamics. However, the combination of shuttle transfers, alternative pipeline routes, strategic reserve releases, and declining global demand has limited the economic impact of the war.

Shuttle transfers have become a crucial factor in capping oil prices. Despite recent vessel attacks, transfer deals are still operating at full capacity, with actual volumes exceeding market estimates of 4 million barrels per day. According to people familiar with the shipping situation, volumes could be as high as 9 million barrels per day.