Oil prices advanced for a fourth consecutive session on Wednesday as the continuing dispute between the United States and Iran over the Strait of Hormuz reinforced concerns that global crude supplies could remain constrained in the months ahead.
Benchmark Brent crude futures gained 0.3% to $91.32 a barrel by 04:43 ET (08:43 GMT), while U.S. West Texas Intermediate crude futures rose 0.4% to $85.28 a barrel. Both benchmarks have recorded strong gains this week and were trading close to three-week highs.
The rally has been underpinned by uncertainty surrounding tanker movements through the Strait of Hormuz, one of the world’s most important energy transit routes, as the conflict involving Iran continues.
Tanker Traffic Through Strait of Hormuz Declines
Shipping data cited by Reuters showed a reduction in commodity vessel traffic through the strait. Six vessels crossed the waterway on Tuesday, according to Kpler figures reported by Reuters, compared with nine on Monday and a 10-day daily average of 11.
“Reports of reduced vessel traffic through the Strait of Hormuz have also raised concerns over potential oil supply disruptions,” analysts at ING said in a note.
Al Jazeera reported that U.S. Secretary of State Marco Rubio discussed Gulf security with United Arab Emirates National Security Adviser Sheikh Tahnoon bin Zayed Al Nahyan. The two reportedly emphasised the importance of maintaining freedom of navigation through the Strait of Hormuz.
Washington and Tehran Remain Divided Over Strait
U.S. President Donald Trump said on Tuesday that no negotiations with Iran were underway or scheduled, although he maintained that the Strait of Hormuz remained open.
Iran has similarly said that talks with Washington are not taking place. However, Tehran rejected U.S. claims that the waterway was open and said the strait would remain closed until Washington complied with the terms of an interim agreement signed in June that has now expired.
That framework lapsed this week, with neither the United States nor Iran indicating that it intends to renew the arrangement.
The absence of diplomatic progress has kept a substantial geopolitical risk premium embedded in crude prices, with traders closely monitoring whether disruption to tanker movements could translate into a more significant reduction in physical oil supplies.
Lower U.S. Inventories Provide Additional Support
Oil prices received further support from preliminary U.S. inventory figures released by the American Petroleum Institute, which indicated a modest decline in crude stocks last week.
“The oil market also drew support from a slightly bullish API inventory report,” the ING analysts said.
The API figures often provide an early indication of the direction of official U.S. inventory data, which is scheduled for release later on Wednesday.
Declining commercial inventories add to concerns over U.S. supply availability after recent figures showed the Strategic Petroleum Reserve falling to its lowest level in more than four decades amid the Iran conflict.
With tanker traffic through Hormuz reduced, diplomatic negotiations stalled and U.S. inventories tightening, oil markets remain highly sensitive to developments in the Persian Gulf as Brent and WTI trade near their highest levels in several weeks.