Oil Rises for the Fourth Day as Supply Risks Escalate

SadaNews Economy - Oil continued its gains after President Donald Trump downplayed the likelihood of talks with Iran in the near term, while threatening to launch broader strikes, as global supply risks extended beyond the Middle East to the Black Sea.

Brent crude rose to trade near $92 a barrel, marking an increase for the fourth consecutive day, while West Texas Intermediate crude surpassed $85. Trump vowed to respond if Iran-backed Houthi rebels in Yemen disrupted shipping in the Red Sea, and reiterated his threats to strike soon at "Pic Axe Mountain," believed to house a secret nuclear site.

The U.S. military has conducted strikes against Iran for the eleventh consecutive day in an attempt to weaken the country's capabilities to threaten commercial shipping in the Strait of Hormuz, according to U.S. Central Command. They added that the waterway remains open despite Iranian attacks.

Oil futures have risen this month as the U.S. and Iran escalate hostilities across the Middle East, with three tankers coming under attack in recent days in the Strait of Hormuz near Oman.

The Ukraine Crisis Intensifies Pressure on the Market

Outside the region, the market is also dealing with a series of attacks on a Caspian Sea pipeline station located on the Russian Black Sea coast, which ships most of Kazakhstan's crude oil.

Trump said on Tuesday that Iran "strongly wants to meet," adding that the United States is not interested. Tehran has denied claims that it is seeking talks. Crude prices have fluctuated repeatedly depending on prospects for escalation or de-escalation.

Jay Hatfield, CEO of Infrastructure Capital Management LLC, said: "Our view is that we will remain somewhat within a price range of $80 to $90, depending on news flow." He added: "If the Red Sea is effectively closed, that would pose a threat. We haven't seen that yet. It could push us above $100."

Red Sea Threats Expand Supply Risks

Following Houthi threats to maritime navigation, it appeared that some tankers had temporarily halted as they approached Yemeni waters, while others altered their course towards the Suez Canal. Nevertheless, other ships continued to move towards the area.

The Red Sea has become a vital route for Saudi exports during the war, enabling the kingdom to redirect some flows via pipelines and bypass the Strait of Hormuz. Observable commercial shipping traffic through the narrow waterway near Iran hit its lowest level in three weeks.

Brent crude could exceed $100 a barrel before the end of the year if the conflict in the Middle East persists and commercial inventories in OECD countries draw down further, according to a note from Bernstein.

Goldman Sachs Group also pointed to the possibility of prices returning to triple digits, although this is not the bank's base case scenario.

Brent crude for September delivery rose by 1.1% to $92.05 as of 11:15 a.m. Singapore time.

West Texas Intermediate crude for September delivery increased by 1% to $85.20.