Oil Prices Rise as US-Iran Deal Doubts and Ship Attacks Fuel Supply Concerns
Oil prices rose on August 12 as doubts about a US-Iran peace deal and attacks on two ships fueled concerns about Middle East supply disruptions. The Brent futures contract gained $0.72, or 0.81%, to $89.63 a barrel by 0053 GMT, while the US West Texas Intermediate crude climbed $0.71, or 0.85%, to $83.91.
The attacks on shipping in the Strait of Hormuz and the Bab el-Mandeb Strait were reported separately by the US and Yemen's Iran-aligned Houthis on Tuesday. Mohsen Rezaei, Iran's top security official, said that the vital Strait of Hormuz shipping route would remain closed unless the US accepted Iran's conditions for ending the war.
However, market sources citing American Petroleum Institute data showed that US crude inventories rose sharply in the week ended August 7. Crude stocks increased by about 9.1 million barrels, while gasoline and distillate inventories fell by 1.5 million barrels and 596,000 barrels, respectively.
The rise in US crude inventories could ease market concerns about supply tightness, according to Haitong Futures.