Oil prices steady as investors assess US-Iran war outlook

Oil prices stabilized on Thursday as market observers weighed the potential for a US-Iran conflict and the safety of maritime routes through the Strait of Hormuz. Brent crude futures for October delivery surged 25 cents, or 0.3%, to $91.87 a barrel, while US West Texas Intermediate crude futures for September fell 2 cents to $85.81 a barrel.

The more volatile October WTI contract climbed 14 cents, or 0.2%, to $84.53. Both Brent and WTI benchmarks surged for a fourth consecutive day, hitting their highest level since July 24. Hiroyuki Kikukawa, a chief strategist at Nissan Securities Investment, attributed the steady prices to sporadic Middle Eastern attacks, but noted the market lacked fresh impetus without a major escalation.

He also mentioned uncertainty surrounding peace talks and tensions involving the United Arab Emirates, Oman, and Iran. The UAE's suspension of all financial and economic dealings with Iran since Tuesday has reignited attention on the strained relationship between the Gulf oil giant and Iran. On Tuesday, US President Donald Trump stated there were no ongoing talks with Iran, and he declared the Strait of Hormuz open.

Iran, however, claimed the waterway remained closed. Data from Wednesday indicated that shipping through the Strait of Hormuz had slowed, as most shipowners avoided the crucial waterway due to the absence of clear information on its reopening following the Iran war. In the U.S., crude and gasoline inventories increased last week, while distillate stockpiles declined, according to the Energy Information Administration's report on Wednesday.

Crude inventories increased by 4.4 million barrels in the week ending August 14, surpassing forecasts for a 600,000-barrel reduction.