Oil Prices Soar on Hormuz Uncertainty
Oil prices continued their upward trend on Wednesday, reaching a four-day high as investors remained uncertain about the status of the Strait of Hormuz. Brent crude futures rose by $0.69 or 0.8% to $91.71 per barrel, while US West Texas Intermediate crude futures increased by $0.76 or 0.9% to $85.70 a barrel.
The uncertainty surrounding the strait is due to conflicting messages from Tehran and Washington on whether it is open for shipping. On Tuesday, US President Donald Trump stated that no talks were taking place with Iran and insisted that the Strait of Hormuz was open, contradicting an Iranian assertion that the waterway remained shut.
June Goh, a senior oil market analyst at Sparta Commodities, noted that shipping risks are increasing again due to attacks from Iran and Houthis in key chokepoints. However, Gulf producers are finding alternative export routes to bring oil out to the Gulf of Oman, which could help increase production.