WTI holds gains above $89.50 amid renewed Middle East hostilities
West Texas Intermediate (WTI) oil price rebounds after registering losses in the previous day, trading around $89.60 during the Asian hours on Thursday. Crude oil prices advance as investors assessed renewed hostilities in the Middle East alongside efforts to reopen the Strait of Hormuz.
West Texas Intermediate (WTI) oil prices climbed above $89.50 after previously falling the day before, reaching approximately $89.60 during Asian trading hours on Thursday. The increase in oil prices was driven by concerns over renewed Middle East hostilities and the reopening of the Strait of Hormuz. President Donald Trump stated that the latest attacks on Iran would be brief, but reiterated that the US could launch further strikes.
He also claimed that the US holds control over the strategic waterway. In response, Iran alleged that it had already struck US bases in the region and launched missiles towards Jordan. The US Treasury Secretary, Scott Bessent, reported that Iran's economy was entering an acceleration phase of bankruptcy. Despite the conflict, 17 million barrels of crude oil successfully passed through the Strait of Hormuz on Monday, which suggested that Iran did not have full control over the vital trade route.
Strategists at BNY noted that the recent US action in the Strait of Hormuz marked a significant shift in policy, as it was the first time the US had targeted Iranian tankers in retaliation for attacks on ships in the waterway. This shift contributed to the recent rise in geopolitical risk premia in oil prices. WTI oil is a high-quality crude oil sold on international markets, sourced in the United States and distributed through the Cushing hub.
The price of WTI oil is primarily influenced by supply and demand factors, such as global growth, political instability, wars, and sanctions. The decisions made by OPEC, a coalition of major oil-producing countries, also play a crucial role in determining oil prices. OPEC's decision to reduce production quotas can lead to tighter supply and higher oil prices, while increasing production has the opposite effect.
The EIA's weekly oil inventory reports and the API's reports are essential in assessing supply and demand, as changes in inventories can indicate fluctuating demand, pushing oil prices up or down.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
