Crude prices moved higher on Wednesday and neared their strongest levels in two weeks as the deadlock between the U.S. and Iran over the Strait of Hormuz showed little sign of ending.
Ongoing attacks on commercial shipping by Yemen’s Iran-backed Houthis also reinforced fears that disruption to oil flows across West Asia could remain prolonged.
Brent oil futures advanced 0.6% to $89.45 a barrel at 00:55 ET (04:55 GMT), while West Texas Intermediate crude futures rose 0.7% to $83.77 a barrel.
Hormuz impasse keeps supply risks elevated
Traffic through the Strait of Hormuz remained subdued as negotiations between Washington and Tehran failed to produce meaningful progress. The situation became more tense after the U.S. said it had struck a ship in the Gulf of Oman that it alleged was travelling towards Iran.
Iran has said the strait will remain shut unless the U.S. agrees to its demands for reparations, which President Donald Trump has strongly opposed.
Hormuz remains critical to the oil market because roughly one-fifth of global oil supplies moved through the waterway before the war began.
Concerns over supply were compounded by further Houthi attacks on ships in the Red Sea and Bab el-Mandeb Strait. The Iran-backed group had previously announced a naval blockade against Saudi Arabia.
The latest developments suggested that tensions in West Asia remain elevated, leaving oil traders focused on the possibility of additional disruptions and helping keep crude prices supported.
U.S. emergency oil stocks drop to fresh low
The U.S. Strategic Petroleum Reserve fell below 300 million barrels last week, according to figures from the Department of Energy.
The reserve declined by 6.1 million barrels to 298.7 million barrels.
The SPR was established to protect the U.S. against major supply emergencies, but inventories have been steadily reduced this year as authorities responded to disruption caused by the Iran conflict.
President Donald Trump authorised the release of 172 million barrels in March following the outbreak of the conflict.
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