US Navy seizes another Iranian vessel
Brent crude’s price pared previous losses after the US Central Command (CENTCOM) seized a vessel attempting to enter Iran’s Bandar Abbas port yesterday.
IMAGE: The Strait of Hormuz, with the Persian Gulf and the Gulf of Oman on both sides. Getty Images
The US Navy has accused Iran of breaking its blockade of the Strait of Hormuz – putting upward pressure on oil prices.
CENTCOM has captured Iranian-flagged cargo vessel M/V Touska after it attempted to transit “the north Arabian Sea at 17 knots enroute to Bandar Abbas,” it said.
The news has rekindled market concerns of further escalation in the Middle East conflict, undermining any fresh ceasefire talks between the two nations.
The price rebound follows a sharp decline last week, after Iran signalled the reopening of the strait and the US expressed optimism over potential peace talks.
Meanwhile, security risks around the region have taken another blow after Iran’s military carried out several attacks on commercial vessels in the Hormuz region over the weekend, with the United Kingdom Maritime Trade Operations (UKMTO) agency reporting at least 20 incidents affecting vessels operating in and around the Arabian Gulf, Strait of Hormuz, and Gulf of Oman.
Commercial vessels attempting to cross the strait on Saturday received radio messages from Iran's navy barring them from passing, Reuters reported. Iran has stopped at least 20 vessels from transiting the region, the report added.
India is weighing a diplomatic response after two Indian-flagged vessels were attacked near the Strait of Hormuz on 18 April, its Ministry of External Affairs (MEA) said in a statement. One of the vessels was a very large crude carrier (VLCC) carrying about 2 million bbls of Iraqi crude, state-media reported.
The latest developments have diluted earlier expectations of a negotiation between Washington and Teran – specially with new rounds of talks scheduled in Islamabad later today.
“After a large selloff on Friday, energy markets are stronger this morning as tensions in the Persian Gulf build once again,” two analysts from ING Bank noted.
With the strait still under Iranian control and vessel movement restricted by the US Navy, the risk of sustained disruption to global oil flows is rising, leaving markets braced for renewed volatility and possible supply shocks.
By Aparupa Mazumder
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