Brent crude climbed to $72.57 a barrel Monday as fresh hostilities between the U.S. and Iran disrupted tanker traffic through the world's most critical oil chokepoint, even as both sides agreed to renew talks.
MONTREAL (Oil Monster): Oil prices rose on Monday following days of tit-for-tat strikes by the U.S. and Iran that underscored the fragility of their interim peace deal and again slowed energy shipping through the Strait of Hormuz.
Brent crude futures climbed 58 cents, or 0.8%, to $72.57 a barrel at 0207 GMT, while U.S. West Texas Intermediate (WTI) crude was at $70.11 a barrel, up 88 cents, or 1.3%.
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Crude Shipments Through Hormuz at Highest Since Iran War BeganDespite persistent geopolitical uncertainty, analysts noted that oil market participants appeared focused on the potential benefits of a supply recovery rather than ongoing risks.
"There's still plenty of risk facing the oil market. Even so, participants appear to be focusing on what a continued recovery in oil flows would mean for the global balance," ING analysts said in a note on Monday.
"This complacency is odd and clearly leaves significant upside risk if the supply recovery proves slow."
Brent crude had fallen 10.6% last week — its third consecutive weekly decline — after crude shipments through the Strait of Hormuz rose to their highest level since the U.S.-Israeli war on Iran began in late February.
However, traffic through the strait slowed again following renewed attacks on ships from Thursday, including a Qatar-linked oil tanker. Those attacks triggered retaliatory strikes from both the U.S. and Iran in what officials described as the worst escalation since the two sides signed an interim peace deal.
Capping oil price gains Monday, Iran and the U.S. agreed to halt recent hostilities in the Gulf and renew talks regarding their dispute over the Strait of Hormuz, a U.S. official said on Sunday.
"The market is likely to re-evaluate its assumption of a quick recovery of oil supply from the Persian Gulf," ANZ analysts said in a note.
Saudi oil giant Aramco resumed crude oil loadings on Friday at its Ras Tanura terminal, west of the Strait of Hormuz, after they were halted for nearly four months, as oil producers ramped up output and exports ahead of the interim deal.
Loadings continued even after a helicopter belonging to the company crashed on Sunday at Ras Tanura, killing 14 nationals. The cause of the crash was unknown.
"Physical flows are constrained by tanker backlogs, damaged infrastructure and production shut-ins. It could take the remainder of the year before supply is near pre-conflict levels," ANZ analysts said.
Oil prices rose after renewed U.S. and Iran strikes slowed tanker traffic through the Strait of Hormuz, raising fresh concerns about a slower-than-expected recovery in Persian Gulf oil supply.
Brent crude futures were at $72.57 a barrel, up 0.8%, while U.S. WTI crude was at $70.11 a barrel, up 1.3%, at 0207 GMT Monday.
Attacks on ships in the Strait of Hormuz from Thursday — including a Qatar-linked oil tanker — triggered retaliatory strikes between the U.S. and Iran, marking the worst escalation since both sides signed an interim peace deal.
Yes. Aramco resumed crude oil loadings at its Ras Tanura terminal on Friday after they were halted for nearly four months. Loadings continued on Sunday despite a helicopter crash at the facility that killed 14 people.
ANZ analysts said it could take the remainder of 2026 before supply returns to near pre-conflict levels, due to tanker backlogs, damaged infrastructure, and production shut-ins.
Courtesy: www.reuters.com
