West Texas Intermediate crude climbed 2.1% to $85.37 a barrel on Friday and Brent added 1.6% to $90.46, with both benchmarks still on pace to surge more than 20% in July. Ship-tracking data showed a modest pickup in tanker traffic through the Strait of Hormuz, even as the conflict widened toward Egypt's Suez Canal approach and U.S. crude stockpiles fell to their lowest level since 2018.
West Texas Intermediate crude climbed 2.1% to $85.37 a barrel on Friday, while Brent crude added 1.6% to reach $90.46, as crude flows out of the Gulf region increased despite stalled U.S.-Iran negotiations. Both benchmarks were on track to surge more than 20% in July, even as they were set for weekly losses that reflected muted hopes early in the week for peace talks.
Hormuz tanker traffic edges higher
Ship-tracking data showed a modest uptick in tanker movements through the Strait of Hormuz, easing some concern over a prolonged disruption to one of the world's most important oil transit routes. Crossings remained in single digits, but according to ING analysts: "the shuttling of oil across the strait has resumed".
Dubai premium rises as Trafigura leads buying
The spot premium for Middle East crude benchmark Dubai rose Friday as trading activity increased, while premiums for Oman and Murban grades fell. Trader Trafigura was the primary bidder during Friday's session, having also led buying activity in the two previous trading days.
Even so, both Oman and Dubai premiums recorded monthly declines for July, after increased Hormuz flows earlier in the month eased supply expectations. Two very large crude carriers passed through the strait on Friday, each hauling approximately 2 million barrels of crude, among four commodity vessels that used the waterway that day before all four exited it.
Conflict risk spreads toward Egypt and the Suez Canal
Saudi Arabia also held talks with representatives from 43 countries on forming a maritime coalition to safeguard shipping around the Red Sea, aiming to counter a blockade Iran-backed Houthi militants imposed last week. The war also showed signs of widening beyond the Gulf: an unidentified drone struck gas vessels at Egypt's Damietta port near the Suez Canal on Wednesday, triggering fires and raising concern that another critical energy transit route could come under threat. That heightened worries over shipping through the Suez Canal and the nearby SUMED pipeline, key routes carrying crude and refined fuel from the Middle East to Europe.
Crude stockpiles fall to their lowest since 2018
Attacks on refineries across the Middle East and Russia have tightened supplies of gasoline, diesel and jet fuel, keeping refining margins near record highs even as crude stays below its historic peak. U.S. commercial crude stockpiles, meanwhile, fell 7.2 million barrels to 404.5 million barrels in the week ended July 24 — their lowest level since 2018, according to the Energy Information Administration. The sharp draw added to fears that an expanding Middle East conflict could further tighten global supplies.
Sources: Commodities & Futures News, Commodities & Futures News
Trading involves risk.
Risk Disclaimer
