Oil steadies as Hormuz attacks blunt hopes for Iran truce

Oil prices rebounded on Wednesday after plummeting to two-month lows the previous day, as market sentiment oscillated between optimism over potential de-escalation in the Iran conflict and apprehension over persistent attacks on vessels traversing the Strait of Hormuz. Brent futures surged by 71 cents, or 0.78%, to $92.20 a barrel, while US West Texas Intermediate (WTI) crude climbed 49 cents, or 0.57%, to $86.53.

New data revealed that 37 ships were targeted in the Strait of Hormuz and adjacent waters during October, marking the highest monthly tally since the onset of the war, according to the Washington Institute for Near East Policy. Additionally, ten attacks have been documented thus far in November. Videos posted on social media on Sunday and subsequently verified by Reuters depicted a Navig8 tanker ablaze near the coast of Oman, among three vessels struck on Sunday for utilizing unauthorized routes through the strait, as per the Iranian state broadcaster.

Another tanker sustained damage northeast of Oman’s Lima, as confirmed by the United Kingdom Maritime Trade Operations (UKMTO) agency on Tuesday.

Iran’s Revolutionary Guards Navy disclosed in a separate statement on Tuesday that two tankers caught fire following collisions with naval mines on unauthorized routes in the strait. Even if a settlement is reached, heightened flow through the waterway would still hinge on mine clearance, insurance expenses, and shipowners' willingness to venture into such risks, stated LSEG analysts in a November 10 note.

Meanwhile, the attacks have not abated. In the preceding session, oil prices had initially dropped by more than $3 a barrel following US officials' dismissal of the necessity for further military strikes against Iran. However, they recovered a portion of those losses after an Iranian security official declared that no discussions were underway between the two sides.

US crude oil inventories increased in the most recent week, market sources reported, citing data from the American Petroleum Institute. Crude stocks rose by 9 million barrels in the week concluding November 6, according to these sources. In Russia, oil refining capacity has been diminished by approximately 30% since late October in response to renewed Ukrainian drone assaults, according to industry sources.

Russian and Ukrainian officials convened in Abu Dhabi on Tuesday for their inaugural peace talks since February, as US President Donald Trump’s envoys embarked on a fresh endeavor to resolve the conflict.