Oil Prices Surge to $90 as Middle East Tensions Escalate
Oil prices have risen to nearly $90 per barrel as tensions in the Middle East continue to escalate. On Wednesday, Brent crude increased by 72 cents or 0.81% to reach $89.63, while US West Texas Intermediate (WTI) crude rose by 71 cents or 0.85% to $83.91.
The price hike is attributed to the weakening hopes for a US-Iran peace deal and concerns about possible supply disruptions due to shipping attacks in the region.
Mohsen Rezaei, an Iranian security official, stated that the Strait of Hormuz would remain closed until Washington accepts Iran's conditions, which include releasing frozen assets and ending regional conflicts. Shipping data shows that only six vessels passed through the Strait on Monday, a significant decrease from the pre-war traffic of 125 to 140 vessels daily.
The American Petroleum Institute reported a sharp rise in US crude inventories, with an increase of about 9.1 million barrels during the week ending August 7. However, this may not ease concerns about tight supplies as longer-term risks remain due to Middle East production disruptions.