Oil prices steady as investors assess US-Iran war outlook

Oil prices stabilized in early trading Thursday as traders weighed the potential of a US-Iran conflict and the safety of shipping through the Strait of Hormuz. Brent crude futures for October delivery increased by 25 cents, or 0.3%, to $91.87 a barrel, while US West Texas Intermediate crude futures for September fell by 2 cents to $85.81 a barrel.

The WTI contract for October gained 14 cents, or 0.2%, to $84.53. Both Brent and WTI benchmarks rose for the fourth consecutive day, reaching their highest levels since July 24. The September WTI contract expires later on Thursday. Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, noted that oil prices are supported by sporadic Middle Eastern attacks but lack momentum without a significant escalation.

The market is expected to continue a steady upward trend due to ongoing uncertainties surrounding peace talks and tensions involving the United Arab Emirates, Oman, and Iran. The UAE's ban on all financial and economic dealings with Iran until further notice has drawn attention to the strained relations between the key Gulf oil producer and Iran.

President Donald Trump declared no talks with Iran and that the Strait of Hormuz remained open, yet Iran claimed the waterway remained closed. Shipping through the Strait of Hormuz slowed, according to data released on Wednesday, as most shipowners opted to avoid the crucial waterway due to a lack of clear information on its reopening following the blockade imposed during the Iran war.

On Wednesday, the Energy Information Administration reported that crude inventories in the US increased by 4.4 million barrels during the week ending August 14, surpassing expectations of a 600,000-barrel reduction.