Oil edges up on uncertainty over exports through Hormuz

Oil prices inched upward on Wednesday, surging for the fourth consecutive day amid supply uncertainty. Traders analyzed conflicting communications from Tehran and Washington regarding the Strait of Hormuz's status for shipping. Brent crude futures rose 26 cents, or 0.29%, to $91.28 per barrel, while US West Texas Intermediate crude futures climbed 37 cents to $85.31 per barrel.

On Tuesday, Brent crude futures had peaked at their highest level since July 24, as hopes for peace between the US and Iran waned. President Donald Trump stated on Tuesday that no negotiations were underway with Iran and affirmed the Strait of Hormuz remained open, which contradicted Iran’s claim that the crucial waterway remained closed to vessels.

The temporary ceasefire accord expired on Monday, and a senior Iranian official confirmed to Reuters that his nation was preparing to act due to the diplomatic impasse, though there were no reports of fresh attacks by either side on Tuesday. To circumvent the Strait of Hormuz, Iraq’s cabinet devised mechanisms for exporting crude oil via specialized international and local entities and multiple export channels, according to a government statement released after a cabinet meeting.

These contracts would be active for three months, beginning September 1. Simultaneously, two major Chinese shipping conglomerates halted sending oil tankers through the Strait of Hormuz and the Bab al-Mandeb strait due to the Middle East conflict and began collecting oil cargoes outside the Gulf region, as reported by three industry executives, tanker trackers, and a ship broker.

In the United States, crude oil and distillate inventories declined last week, while gasoline stocks rose, according to market sources citing data from the American Petroleum Institute. Official inventory figures from the US Energy Information Administration were scheduled for release at 10:30 a.m. ET (1430 GMT), with analysts surveyed by Reuters anticipating crude stocks to have decreased by approximately 600,000 barrels in the week ending August 14.