Oil gains as uncertainty clouds Iran-Oman deal on Hormuz

Oil prices are ticking higher as a tentative Iran-Oman accord on the Strait of Hormuz remains elusive.

IMAGE: Getty Images

Brent crude’s price is poised to end the week above $80/bbl mark as Iran-Oman agreement on the Strait of Hormuz and parallel diplomatic discussions between Washington and Tehran have not yielded any breakthroughs yet.

An Iranian parliamentary committee is ​reviewing the agreement on shared control of the narrow waterway, Reuters reported. The agreement will bar the US, Israeli and ​other “hostile” vessels from ​transiting the region, the report added.

The draft bill will also allow Tehran to impose ​fines of up ​to 20% of a vessel’s ‌cargo ⁠value for violations of the proposed restrictions – a move that Washington has consistently opposed.

Meanwhile, the US Central Command (CENTCOM) has rejected these claims, reiterating its control over the critical chokepoint that handled roughly one-fifth of global seaborne crude flows before the conflict.  

As of yesterday, the US CENTCOM had redirected 49 commercial vessels, disabled two, and boarded two to prevent ships from entering or departing Iranian ports, it said on social media platform X.

Attacks resume in Hormuz

Adding further upward pressure on oil, more vessels have come under attacks in the Strait of Hormuz.

The United Kingdom Maritime Trade Operations (UKMTO) agency reported an incident about 9 nautical miles southeast of Kumzar, Oman.

“The Master of a tanker has reported hearing two explosions whilst transiting in the Strait of Hormuz,” the UKMTO said.

Meanwhile, Tehran has claimed attacks on two “hostile” oil tankers – NISSOS KEA and NISSOS KEROS – transiting the Strait of Hormuz via the southern Omani US-backed corridor under US escort, Bloomberg reported.

The attacks come as President Donald Trump and other senior US officials claim Washington is close to a deal that would reopen the Strait to commercial vessels.

Red Sea threats persist

Yemen’s Iran-aligned Houthi militants continue to pose a threat to commercial vessels transiting the Bab al-Mandeb Strait into to Red Sea – inevitably escalating the Middle East conflict.

Yesterday, the Houthis conducted a “large-scale” operation targeting Saudi Arabian troops positioned in central and eastern Yemen, the group’s spokesperson Yahya Sare’e said on X.

Earlier this week, the group attacked multiple cargo ships in the Red Sea, causing one vessel to capsize and sink.

The India-flagged oil tanker was carrying Saudi-origin crude oil when it sank off the coast of Yemen in the Red Sea, after being hit by a projectile.

Subsequently, New Delhi has issued an advisory for seafarers deployed in the Middle East.

“Recent incidents involving attacks on merchant vessels, have highlighted the increasing risks faced by seafarers and commercial ships operating in the conflict-affected area,” India’s Directorate General of Maritime Administration said in a statement.

The UKMTO reported another incident about 95 nautical miles southeast of Aden, Yemen, on Wednesday.

Hostilities in the Red Sea come after the Houthis announced an embargo on Saudi Arabian exports through the Red Sea on 22 July.

Riyadh is bracing for “multiple coordinated attacks” by Iraqi militias working with the Houthis, as the conflict continues to broaden in the region, CNN reported citing an unnamed official.

By Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online