Oil Prices Rise Amid Ship Attacks

PHOTO CAPTION: A pump jack operates near a gas turbine power plant in the Permian Basin oil field outside of Odessa, Texas, U.S. February 18, 2025. REUTERS/Eli Hartman

LONDON, Aug. 12 — Oil prices rose in volatile trading Wednesday after attacks on two ships renewed concerns about disruptions to Middle East energy supplies, while efforts to end the Iran war appeared to hit an impasse.

Brent crude futures were up 17 cents, or 0.2%, at $89.08 a barrel by 10:55 GMT, heading for a sixth straight day of gains. U.S. West Texas Intermediate crude rose 20 cents, or 0.2%, to $83.40, on track for a fifth consecutive daily gain.

Both benchmarks had risen by more than $1 earlier before briefly turning lower as traders focused on U.S. crude inventory data that industry sources said could show a large increase in stockpiles. Prices resumed gains after a senior Iranian source told Reuters there were no discussions between Iran and the United States to extend their ceasefire because, from Tehran’s perspective, the agreement had no start date and therefore nothing to extend.

Shipping attacks raise supply concerns

The United States and Yemen’s Iran-aligned Houthis reported separate attacks on shipping Tuesday in the Strait of Hormuz and Bab el-Mandeb Strait, two major routes for Middle East oil and gas exports alongside the Suez Canal.

Shipping data showed only eight vessels transited the Strait of Hormuz on Tuesday, the lowest level in a week. Before the war, between 125 and 140 vessels typically passed through the waterway each day.

Investors were also awaiting official U.S. crude inventory figures later Wednesday. Market sources citing American Petroleum Institute data said crude inventories rose by about 9.1 million barrels from the previous week, while gasoline stocks fell by 1.5 million barrels and distillate inventories declined by 596,000 barrels.

Haitong Futures said the crude build was much larger than expected and, if confirmed by the Energy Information Administration’s report due at 10:30 a.m. ET, or 14:30 GMT, could ease concerns about tight supplies.

In Libya, the National Oil Corporation said fires at fuel storage tanks in the Zawiya oil complex had been brought under control, another development that limited upward pressure on prices.

For the longer term, the EIA said it expects significant disruptions to Middle East crude supplies to continue through the end of 2027. The agency forecast average 2026 prices of $86.81 a barrel for Brent and $80.88 for WTI.

(Source: Reuters)