Kuwait's military said Thursday it was engaging Iranian missiles and drones, widening a conflict now in its seventh month beyond the Iran-U.S. axis. Brent crude climbed above $96 a barrel and diesel refining margins hit record highs, even as a wartime-record 17 million barrels a day crossed the Strait of Hormuz on Monday.
Kuwait's armed forces said Thursday the country faces ongoing Iranian aggression, with air defenses engaging incoming missiles and drones. The report came hours after Brent crude climbed to $96.20 a barrel, up 57 cents, after breaking $97 earlier in the session. West Texas Intermediate for October delivery traded at $91.98, higher by 97 cents or 1.07%.
The move followed U.S. Central Command strikes on two rocket launchers on Iran's Larak Island, the first publicly acknowledged American attack in weeks. Iran's health minister said 18 people were killed and 108 wounded in Tuesday night's U.S. strikes across Iran. The Iranian Red Crescent said four people were killed and 67 wounded at a wedding ceremony near the coast of the Strait of Hormuz. Three Iranian Army pilots were killed in the strikes, the semi-official Tasnim news agency reported.
Vance links talks to shipping attacks, Katz warns Israel would "cripple" Iran
Vice President JD Vance said Thursday the U.S. does not plan to hold talks with Iran unless Tehran stops attacking commercial shipping in the Strait of Hormuz. Israeli Defence Minister Israel Katz renewed warnings that Israel would "cripple" Iran's military and civilian infrastructure, including energy facilities, if Tehran attacked — comments Saxo Bank analyst Ole Hansen said helped push oil prices higher. According to Reuters: UBS energy analyst Giovanni Staunovo said "The oil market remains tight, with oil inventories still declining globally translating into higher prices."
Diesel margins hit records even as Hormuz flows recover
Even as fighting widened, 17 million barrels of oil transited the Strait of Hormuz on Monday, a wartime record, moving under American military protection. The ICE gasoil crack, meanwhile, hit an all-time high of $79 a barrel while the U.S. diesel crack traded above $100. The ICE gasoil September-November spread trades in backwardation, with prompt barrels commanding an $80-per-tonne premium over deferred ones — a sign of immediate physical scarcity rather than speculative positioning.
Vessel traffic thins, Iraq exports rise, Putin signals openness on Ukraine
Six commodity vessels transited the Strait of Hormuz on Wednesday, down from 11 a day earlier and well below the 10-day average of around 13. Iran added ships to its list of vessels deemed non-compliant, subject to fines, confiscation or detention, though Iraqi vessels remain among those allowed through. Iraq increased its oil exports to around 2.34 million barrels a day in August from about 1.35 million bpd in July, with September exports also expected to rise.
Putin, speaking Thursday at an economic forum in Russia's far east, said there was a chance of reaching an agreement to end the war in Ukraine and that a number of countries including the U.S. and China were ready to support a settlement. Phil Flynn of Price Futures Group said the comments could ease concerns about Russian fuel supply disruptions if attacks on refineries decline and production normalizes — a factor pressuring prices Thursday. U.S. Strategic Petroleum Reserve holdings have fallen below 300 million barrels, the lowest level since January 1983, leaving Washington with less room to cushion any further shock.
Sources: Commodities & Futures News, Commodities Analysis & Opinion
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