Oil prices rose amid negotiations between the U.S. and Iran
Global oil prices resumed their upward trend on Tuesday, August 4, following a sharp drop the previous day.
Investors are once again assessing the risks to energy supplies amid uncertainty surrounding negotiations between the U.S. and Iran, as well as the situation in the Strait of Hormuz.
After a significant decline in the previous session, prices began to rise:
- Brent crude rose by $1.12 (+1.3%) to $84.89 per barrel;
- U.S. WTI crude rose by 77 cents (+1%) to $81.11 per barrel.
The day before, Brent had lost about 7%, and WTI more than 5%, hitting their lowest levels in nearly a week.
Earlier, U.S. President Donald Trump stated that he would refrain from launching new strikes against Iran until negotiations begin to end the conflict and resolve the issue of control over the Strait of Hormuz.
Before the conflict began, nearly one-fifth of global crude oil and natural gas supplies were transported through this strategic maritime artery.
However, Iranian Foreign Ministry spokesman Esmail Baghai refuted the U.S. president’s statements, emphasizing that no negotiations with the U.S. had taken place and none are currently planned.
ING experts believe that the scale of the previous price drop was excessive.
“The scale of the sell-off seems quite exaggerated, given that there is still significant uncertainty. We have been in this situation many times before, but then saw how everything worked itself out,” the analysts noted.
The Strait of Hormuz remains one of the main stumbling blocks. Washington insists that the memorandum of understanding agreed upon in June provides for its opening to international shipping, while Tehran claims that the document reserves Iran’s right to control this route.
According to Barclays estimates, net exports of crude oil and petroleum products through the Strait of Hormuz averaged 4.2 million barrels per day during the week ending July 31. By comparison, the figure for the previous week was 3.2 million barrels.
At the same time, some tankers are rerouting due to security risks. In particular, six supertankers flying the Saudi Arabian flag in the Gulf of Aden set course around southern Africa, while two vessels carrying Saudi oil did pass through the Bab el-Mandeb Strait.
Despite relatively stable shipping traffic, the situation in the region remains tense.
The UK Maritime Trade Operations (UKMTO) reported a new incident—a cargo ship 37 km northeast of the Omani city of Al-Hasab reported being struck by an unknown projectile.
Risks to maritime safety continue to be one of the key factors driving global oil prices.
This was reported by Reuters.
U.S. President Donald Trump stated that the Strait of Hormuz could be fully open to international shipping as early as August 4. After that, he said, Washington and Tehran will move on to a new phase of negotiations focused on Iran’s nuclear program.
U.S. President Donald Trump also called on American oil companies to immediately lower gasoline prices for consumers. Separately, he criticized Chevron CEO Mike Wirth.
