Economy
Oil Prices up on Renewed Middle East Risks
By Adedapo Adesanya
Oil prices were slightly up by 1 per cent on Friday after Iran said it had stopped two vessels seeking to exit the Strait of Hormuz, underscoring concerns over global energy supplies.
Brent futures gained $1.09 or 1.2 per cent to trade at $90.12 a barrel, while the US West Texas Intermediate (WTI) futures chalked up $1.08 or 1.3 per cent to settle at $84.67 a barrel. For July, Brent gained 24 per cent, and WTI rose 21 per cent.
Iran said four other tankers turned back after its forces intervened, although the Iranian reports could not be independently confirmed.
The war in Iran, which began on February 28, has sharply curtailed traffic through the Strait of Hormuz, a vital chokepoint that previously carried about a fifth of global crude oil and natural gas supplies, disrupting millions of barrels per day of Middle East output.
Iran has largely blocked shipping through the strait since the conflict began, while its Houthi allies in Yemen in July threatened vessels transiting the Bab el-Mandeb strait at the southern end of the Red Sea, jeopardising an alternative export route used by Saudi Arabia and other regional producers.
A drone strike that sparked fires on two gas vessels in Egypt’s Mediterranean port of Damietta also raised threats to shipping through the Suez Canal.
A body set up by Iran to manage the Strait of Hormuz said on Friday that crossings remained impossible due to “continued aggressive actions by U.S. military forces in the region.”
However, there were no reports of new US attacks on Iran overnight between Thursday and Friday after what was a sharp escalation in its war on Iran earlier in the week, with joint US-Saudi strikes on Iranian-allied forces in Iraq.
There are indications that this might go over the weekend after US President Donald Trump, in a statement to Fox News on Friday, said the war was going well.
He later said he believed a deal could still be reached with Iran, and Special Envoy Steve Witkoff, his son-in-law Jared Kushner and Secretary of State Marco Rubio are involved in talks.
Earlier in the week, the US Energy Information Administration (EIA) data showed commercial crude stocks last week fell to their lowest levels since 2018.
Oman has presented Iran with a plan backed by Gulf states to manage the Strait of Hormuz, including collecting voluntary fees for using it. This was initially rejected, but Reuters reported that talks with Oman over the waterway were continuing.
