Commodities
U.S. Steps Back from Hormuz Diplomacy, Slowing Oil Price Risk Premium Unwind
The price of Brent crude oil futures surged by more than 3% on September 14 to $108.43 per barrel, its highest level since May 21.
This sudden increase is attributed to several factors, including supply-side shocks from the attack on Saudi pipelines and a significant development in diplomatic efforts related to the Strait of Hormuz.
The U.S. administration has privately informed parties in the Gulf region that they hope future negotiations with Iran will focus on its nuclear program rather than issues surrounding navigation through the Strait of Hormuz, effectively stepping back from direct involvement in shipping diplomacy mediated by Oman.