·
Brent
crude briefly reached $90 per barrel,
its highest level in two weeks, before settling just below $89.
·
WTI
crude rose about
1.8%
to slightly above $83 per barrel.
·
The key
driver is the continuing U.S.-Iran
stalemate and disruption to shipping through the Strait of Hormuz.
·
Iran has
demanded that the Strait remain closed until the U.S. lifts its naval blockade, while President Trump has demanded compensation
from Iran for casualties and damage.
·
The Strait of Hormuz normally carries up to one-fifth
of global oil supplies, making
its disruption a major threat to international energy markets.
·
Commercial
shipping has nearly stalled: only a
handful of oil tankers have crossed
the strait since the weekend, compared with roughly 130 ships per day before the war.
·
Some vessels
are hiding
or altering their identities
to avoid detection while transiting the region.
·
An alternative
export route through the Red
Sea is also
facing growing risks from Houthi attacks on shipping.
·
A Houthi
missile attack reportedly struck a cargo
ship carrying food supplies,
killing at least six people.
·
Despite
the risks, traffic through the Bab
al-Mandab Strait remains
relatively stable, with 36 confirmed crossings on Monday.
·
Higher
oil prices are raising concerns about renewed
inflation, potentially
forcing central banks to maintain or increase interest rates for longer.
·
U.S. gasoline
prices remain elevated at around $4.11
per gallon, approximately
38%
higher than when the war began.
·
Investors
are closely watching U.S. July
inflation data, as persistent
energy-price increases could complicate monetary-policy decisions.
[ABS News Service/12.08.2026]
The price of oil was choppy on Tuesday, reaching $90 a barrel for
the first time in two weeks before falling back, as the stalemate over the Iran war hardens and commercial shipping in the Strait of Hormuz dwindles.
President Trump said on social media on Monday that he had told his aides to demand
compensation from Iran “for all of the people that they have killed and gravely
wounded with their roadside bombs and many conflicts.”
The statement seemed to be a response to a set of demands that Iran made on Monday, claiming the strait would remain closed until the United
States lifted its naval blockade in the region.
Brent crude, the global benchmark, jumped 1.6 percent on Tuesday,
touching $90 a barrel before receding to settle just below $89. West Texas Intermediate,
the U.S. benchmark, was up 1.8 percent to a little over $83 a barrel.
Worries of a protracted standoff were feeding into fears of higher
inflation, analysts at Deutsche Bank wrote in a research note. “That in turn led
to mounting speculation about central bank rate hikes, with investors pricing in
a more hawkish path for the months ahead,” the wrote.
Data on consumer prices, which the Bureau of Labor Statistics will
release on Wednesday, is expected to show that inflation slowed in July.
As the war has dragged on into a sixth month, shipping in the strait,
a narrow path between Iran and Oman that once carried as much as one-fifth of the
world’s oil supply, has been brought to a near standstill.
Only a handful of oil tankers have navigated the Strait of Hormuz
since the weekend, according to data from the maritime firm Kpler.
And many ships are cloaking their identity to avoid being detected, a practice that
has been common since the war began. Before the war, about 130 ships sailed through
the waterway every day.
At the same time, an alternate route for exports using the Red Sea,
deployed by Saudi Arabia since the start of the war, has gotten more dangerous.
The Houthis, an Iranian-backed militia in Yemen, have threatened to block Saudi
ships in the region. On Tuesday, Yemen’s government said missiles fired by the Houthi militia had hit a
cargo ship carrying food supplies in the Red
Sea, killing at least six people.
Traffic through the Bab al-Mandab Strait, on the Red Sea’s southern
end, has been stable, despite the uncertainty. There were 36 confirmed crossings
of the strait on Monday, one more than the day before, Kpler
said.
Activity in that part of the sea downshifted to its current pace
in 2023, when the Houthis launched attacks on shipping in response to Israel’s war
in Gaza.
In the United States, the disruption to energy flows from the Middle
East has translated into elevated gasoline costs. The average price of gasoline
stayed flat on Tuesday at $4.11 a gallon, a 38 percent increase since the war started.