US-Iran war: Oil prices steadied after posting gains over the previous two sessions as tensions between the US and Iran persisted in the Middle East. Adding to supply concerns, Yemen’s Houthi rebels threatened to disrupt Saudi Arabia’s maritime trade through the Red Sea.
Brent crude futures slipped 35 cents, or 0.4%, to $88.87 a barrel, while US West Texas Intermediate (WTI) crude for September delivery held steady at $82.47 per barrel. Despite the decline, both benchmarks remained below the more-than one-month highs reached in the previous trading session.
What’s weighing on crude oil prices today?
The United States carried out a tenth consecutive day of airstrikes after President Donald Trump warned that Tehran would “pay” for the killing of American soldiers. In response, Iran launched attacks on Kuwait.
On Monday, the Iran-backed Houthis announced a ban on maritime traffic linked to Saudi Arabia, threatening the Red Sea shipping route that enables the kingdom to transport millions of barrels of crude oil through a cross-country pipeline, bypassing the Strait of Hormuz. Saudi Arabia said it would take all necessary measures, in line with international law, to safeguard its vessels.
Meanwhile, diplomatic efforts to ease tensions have continued. Iran said mediators were working on proposals to reduce hostilities following more than a week of escalating conflict, while Reuters reported discussions around a proposed 10-day ceasefire. Crude oil prices have remained highly volatile, reacting to both signs of escalation and hopes for de-escalation.
Early on Tuesday, the UK Maritime Trade Operations (UKMTO) reported that a tanker was hit by an unidentified projectile in the Strait of Hormuz, northeast of Oman’s Limah, based on multiple reports, though the vessel was not identified. It remains unclear whether the incident is linked to the attacks on the Dynacom-operated tankers.
The renewed violence around the strategic waterway has also prompted shipowners to offer hefty incentives to crews willing to sail through the Strait of Hormuz. Sinokor Group, the world’s largest owner of supertankers, has reportedly offered seafarers an additional six months’ salary for completing a return voyage through the region.
(With inputs from agencies)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
