Oil prices rebound amid concerns over tanker attacks in the Strait of Hormuz
Oil prices have rebounded, climbing on Wednesday from two-month lows seen in the previous session, as attacks on vessels in the Strait of Hormuz dampen hopes for a de-escalation with Iran.
Additionally, a fire broke out on Wednesday at Russia’s Ust-Luga port on the Baltic Sea following a drone strike, leaving three workers injured.
As of 07:30 GMT, Brent crude futures rose by 52 cents (0.6%) to $92.01 per barrel. Meanwhile, U.S. West Texas Intermediate (WTI) crude increased by 16 cents (0.2%) to $86.20 per barrel.
Amid uncertainty surrounding diplomatic talks, there has been an uptick in attacks on vessels along maritime routes in the Gulf. Data indicates that following October—which saw 37 attacks on ships, the highest monthly total since the onset of the conflict in the Middle East—there has been no sign of a decline in such incidents throughout November.
Nevertheless, with the U.S. midterm elections concluded and an increase in crude oil shipments originating from the Middle East, a downward trend appears to be exerting greater pressure on oil prices.
A key factor for investors is the extent to which Iran might be willing to engage in negotiations—in line with U.S. demands—to reach a diplomatic agreement.
Even if an agreement were to be reached, an increase in shipments passing through this waterway... will continue to depend on mine-clearing operations, insurance costs, and whether shipowners are willing to take on this risk.
In the previous session, oil prices fell by more than $3 per barrel following statements from U.S. officials suggesting a reduced need for further military strikes against Iran; however, some of these losses were recovered after an Iranian security official stated that no discussions had taken place between the parties.
Meanwhile, data from the American Petroleum Institute (API) indicated an increase in U.S. crude oil inventories last week. According to sources, crude oil stocks rose by 9 million barrels during the week ending November 6.
Industry sources reported that Russia's oil refining capacity has declined by approximately 30% since the end of October, following a new wave of drone attacks by Ukraine.
As representatives for Trump launch a new initiative to end the war, Russian and Ukrainian officials met in Abu Dhabi on Tuesday to hold their first peace talks since February.
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