Brent jumps as shipping via Hormuz dwindles
The front-month ICE Brent contract has gained by $1.15/bbl on the day, to trade at $95.92/bbl at 09.00 GMT.
IMAGE: Getty Images
Upward pressure:
Brent crude’s price has moved past the $95/bbl mark after renewed hostilities forced commercial vessels to continue avoiding the Strait of Hormuz.
Saudi Arabia’s Ministry of Foreign Affairs has accused Tehran of attacking the oil tanker Sidr, killing two sailors. The vessel is owned by Saudi Arabia’s national shipping company Bahri.
“Developments in recent days brought risks to regional oil supplies back into focus,” two analysts from ING Bank noted.
As of yesterday, nine vessels attempted to transit the strait, according to market intelligence provider Windward. Six vessels were operating with disabled AIS tracking transmitters.
“We’ve seen oil flow through the Strait of Hormuz despite the stalemate between the US and Iran, but rising tensions clearly put crossings at risk,” ING Bank’s analysts said.
Downward pressure:
While there are no major downward pressures on Brent’s price today, the market found some relief following positive remarks by US secretary of energy Chris Wright earlier this week.
Wright claimed that 17 million bbls of crude oil transited the Strait of Hormuz on Monday, marking the biggest uptick in flows via the narrow waterway in recent months, Reuters reported.
By Aparupa Mazumder
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