Fading U.S.-Iran diplomacy hopes push oil prices higher
Oil prices rose on Aug. 17, as fading hopes for a breakthrough in the U.S.-Iran peace negotiations, along with slower tanker traffic through the Strait of Hormuz, heightened market concerns about geopolitical risk, according to Reuters.
On August 17, oil prices surged as expectations of a U.S.-Iran diplomatic resolution dwindled and tanker traffic through the Strait of Hormuz slowed, amplifying worries about geopolitical risk, according to Reuters. Brent crude futures climbed 1% to $89.40 a barrel, while U.S. West Texas Intermediate crude futures increased 44 cents to $82.83 a barrel. Both indices surged more than 5% last week following attacks on tankers and a Saudi Aramco refinery in the Strait of Hormuz and on July 23.
Iranian Foreign Minister Abbas Araghchi announced Iran's decision not to resume talks with the United States, while President Donald Trump advocated for Americans to tolerate slightly higher gasoline prices during the ongoing conflict. Priyanka Sachdeva, head of market insights at Phillip Nova in Singapore, noted fading hopes for a U.S.-Iran peace accord and reduced tanker traffic through the Strait of Hormuz, which heightened concerns about geopolitical risk.
She suggested that significant upside is unlikely unless there is evidence of renewed aggression in the Strait, such as substantial damage to tankers or oil infrastructure.
Shipping traffic through the Strait of Hormuz decreased over the weekend, with data from Aug. 17 revealing only five cargo vessels passing through on August 15 and none on August 16, compared to 31 vessels in the preceding weekend. In July, President Trump threatened to destroy a bridge or power plant each time Iran attacked a vessel in the Strait of Hormuz.
On July 23, U.S. forces conducted their 12th consecutive nighttime strike on Iran, driving oil prices to their highest level in over six weeks amid tensions in the Red Sea and renewed U.S. attacks on Iran. Despite fresh escalation in the Middle East, oil prices dropped on July 30. On August 10, oil prices rose once more due to uncertainty about the Strait of Hormuz's reopening.
Written by urgent.news from New Voice of Ukraine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
