Oil Prices Surge on Geopolitical Tensions in Strait of Hormuz
Oil prices rose more than 1% on Friday and are headed for a monthly gain as geopolitical tensions continue to drive up shipping costs. Brent crude futures gained $1.01, or 1.13%, to $90.04 a barrel by 11:18 GMT, while U.S. West Texas Intermediate (WTI) crude rose $1.18, or 1.41%, to $84.77 a barrel.
The increase comes as some tankers were forced to turn around in the Strait of Hormuz, prompting traders to reassess shipping volumes through this key waterway. Analyst Giovanni Staunovo said that 'the low flow of vessels crossing the strait supports prices.'
Negotiations between Iran and Oman on managing the Strait of Hormuz continue despite Iran's rejection of Oman's proposal for joint management. Meanwhile, Saudi Arabia seeks to lead a coalition to enhance defense cooperation in key energy supply chokepoints.