Oil held steady as traders weighed President Donald Trump’s newest threat to resume strikes on Iran, a pledge the US leader has made repeatedly before backing off since a truce started in early April.
West Texas Intermediate was near $104 a barrel, after slipping 0.2% on Tuesday, while Brent closed above $111. Trump said that if Iran didn’t agree to US peace terms, “we may have to give them another big hit” — less than a day after he said he had just called off an attack.
Trump’s comments once again raised the prospect of a return to active hostilities with Iran, which has so far refused to bow to US demands to relinquish the remaining elements of its nuclear program after weeks of strikes that began in late February. But the president has repeatedly threatened — and then backed off from — renewed military action since a ceasefire was agreed on April 8, leaving traders reluctant to add to long positions without firmer evidence that fighting will resume.
When asked how long he would wait, Trump said: “Well, I mean, I’m saying two or three days, maybe Friday, Saturday, Sunday. Something maybe early next week — a limited period of time.”
Now in its 12th week, the war has choked traffic through the Strait of Hormuz, driving global energy prices and inflation higher. The US also seized an Iran-linked tanker in the Indian Ocean overnight — at least the third such seizure targeting Tehran’s shadow fleet, the Wall Street Journal reported.
With no resolution in sight, news that NATO is discussing escorting ships through the strait should the route remain closed past early July also weighed on futures. Investors have increasingly priced in a prolonged closure, according to a Goldman Sachs poll earlier this month — meaning a NATO-led effort could return supply to market faster than expected.
Meanwhile, White House officials are holding firm against restricting oil exports even as domestic inventories dwindle. An industry report indicated US crude stockpiles dropped by 9.1 million barrels last week, which would be the biggest decline since September if confirmed by official data due later Wednesday.
On Tuesday, a massive Brent crude put options bet equivalent to 134 million barrels traded in a single block. That rattled a market already on high alert for unusual flows.
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With assistance from Mia Gindis.
This article was generated from an automated news agency feed without modifications to text.
