Oil prices rose on Wednesday from the previous session's two-month lows. The market swung between hopes for de-escalation in the US-Israeli war on Iran and concerns about attacks on shipping in the Strait of Hormuz.
Oil prices rose on Wednesday from the previous session's two-month lows. Traders weighed hopes for a de-escalation in the US-Israeli war on Iran against concerns about attacks on shipping in the Strait of Hormuz.
Brent futures climbed 52 cents, or 0.6%, to $92.01 a barrel by 0730 GMT. US West Texas Intermediate crude rose 16 cents, or 0.2%, to $86.20.
Shipping attacks show little sign of easing
Recent data showed little sign of fewer attacks in November, after 37 ships were attacked in October. That was the highest monthly total since the start of the Middle East war, according to the Washington Institute for Near East Policy.
On Tuesday, the United Kingdom Maritime Trade Operations agency said a tanker was struck northeast of Lima in Oman. Separately, Iran's Revolutionary Guards Navy said two tankers caught fire after hitting naval mines on an unauthorized route in the strait.
June Goh, senior analyst at Sparta Commodities, said vessel attacks in the Gulf shipping lanes have increased amid uncertainty over the diplomacy talks. She added that, with the US midterms over and more crude flowing out of the Middle East, there seems to be more bearish tones in the oil price. In her view, the top driver is how far Iran will come to the table with US demands.
Higher Hormuz flows would still depend on mine clearance and insurance
In the previous session, oil prices initially fell by more than $3 a barrel after US officials downplayed the need for further military strikes against Iran. Some of the losses were clawed back after an Iranian security official said no talks were taking place between the two sides.
Even if a deal is struck, LSEG Oil Research said in a November 10 note that higher flows through the waterway would still depend on mine clearance, insurance costs and whether shipowners are willing to take the risk.
Meanwhile, market sources citing American Petroleum Institute data said US crude oil stocks rose by 9 million barrels for the week that ended on November 6.
Source: Reuters via Investing.com
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