Oil Prices Rise on Uncertainty Over Exports Through Critical Waterway
Oil prices rose in early trade on Wednesday for a fourth consecutive day due to supply uncertainty stemming from the ongoing conflict between Iran and the US. The Strait of Hormuz, a critical waterway through which oil is transported, remains at the center of the tensions.
US President Donald Trump stated that no talks were taking place with Iran and asserted that the Strait was open for shipping, contradicting Iran's assertion that it remained closed to ships due to diplomatic stalemate. A temporary ceasefire agreement expired on Monday, and a senior Iranian official announced his country's shift towards a 'fully offensive' military posture.
To mitigate risks, Iraq's cabinet approved mechanisms for exporting Iraqi crude through specialized international and local companies via multiple export outlets. The contracts under this new mechanism will run for three months starting September 1.