Oil prices rose as latest conflicts revived risks of supply disruptions
Oil prices surged on Tuesday as renewed fighting between the US and Iran in the Middle East reignited fears of supply disruptions.
Brent crude futures rose 66 cents, or 0.7%, to $91.15 a barrel at 06:40 GMT, while WTI crude rose 70 cents, or 0.8%, to $86.46.
In the previous session, Brent crude closed up 2.7%, briefly reaching its highest level since August 25, and WTI crude closed up 2.8%, touching its highest level since August 21.
Trump vowed to strike Iran hard. He threatened further attacks on Iran after direct strikes between the two countries in a month on Monday, escalating tensions in the conflict.
These events raise renewed concerns about potential Iranian retaliation and increase the likelihood of damage to energy infrastructure around the Gulf. They also create new uncertainty for shipping through the Strait of Hormuz.
According to data, the number of visible commodity ships passing through the Strait of Hormuz on Monday remained at five, below the 10-day average of around 14. None of the five ships were liquid tankers.
Efforts by mediators, including Qatar and Oman, to secure an agreement to reopen the Strait of Hormuz have so far been unsuccessful.
Iran closed the strait after the US and Israeli attack on the country on February 28.
On Tuesday, a tanker was reportedly hit by three shells while exiting the Strait of Hormuz. No casualties or environmental impact were reported.
While satellite tracking firms suggest oil flowing through Hormuz is around 6 million barrels per day, this is well below pre-conflict levels.
Meanwhile, the inventories relied upon by the global oil market are beginning to dwindle. As US inventories approach minimum levels, China's ability to keep imports low will be tested by rising seasonal demand.
US Strategic Petroleum Reserve crude oil inventories fell by approximately 3.1 million barrels last week to 286.6 million barrels.
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