2 weeks ago
Oil Holds Four-Day Gain as Iran Standoff Keeps Hormuz Focus
Oil prices went up for the fourth day in a row.
Traders were worried about a disagreement between the United States and Iran.
The disagreement involves the important Strait of Hormuz, where oil ships travel.
Some oil is still moving through the waterway, although traffic is much lower than usual.
The UAE said Iran fired two missiles toward its territory and stopped trade with Iran.
Iran said it did not fire the missiles.
US oil data showed that some fuel supplies were tight, even though crude stockpiles increased.
These events made traders concerned that oil supplies could become harder to move.
Oil prices rose for a fourth consecutive day, with Brent near or above $91 a barrel and WTI above $84-$85.
The United States and Iran remained locked in a standoff, while Donald Trump gave differing signals about whether talks might resume.
The United Arab Emirates suspended trade and financial dealings with Iran after accusing it of launching two ballistic missiles.
Iran denied firing missiles at the UAE, calling the accusation baseless.
Oil prices also received support from shipping through the Strait of Hormuz, falling distillate inventories, and strong refinery activity, despite higher crude stockpiles.
- Who
- The United States, Iran, the United Arab Emirates, Donald Trump, and oil-market participants are involved.
- What
- Oil prices extended a four-day rise amid a US-Iran standoff, an alleged missile incident, and uncertainty over shipping through the Strait of Hormuz.
- Where
- The developments involve Iran, the UAE, the Strait of Hormuz, and US oil markets.
- When
- Brent closed above $91 a barrel on Tuesday, August 18, while WTI rose in Wednesday trading; another report described Brent as near $92 and WTI above $84.
- Why
- Prices were supported by geopolitical tensions, concerns about Hormuz shipping, falling distillate inventories, strong refinery activity, and earlier declines in US stockpiles.
US and UAE claims
Iran’s response
Alleged missile launches
US and UAE claims
The UAE said Iran fired two ballistic missiles toward its territory. Its Defence Ministry said one reached UAE waters and the other fell into the sea.
Iran’s response
Iranian Foreign Ministry spokesperson Esmail Baghaei denied that Iran fired missiles at the UAE and called the accusations baseless.
Diplomatic engagement
US and UAE claims
Donald Trump said there were no ongoing or scheduled talks with Iran, while also saying talks might resume at some point.
Iran’s response
Iran was described as remaining in a standoff with the United States; the articles provide no separate Iranian account of the status of talks.
Regional escalation
US and UAE claims
The UAE said regional escalations by Iran justified suspending trade and financial ties with Tehran.
Iran’s response
Iran rejected the UAE’s account of the missile incident and denied responsibility for the alleged attack.
Key facts
- Brent crude
- Closed above $91 a barrel on Tuesday, August 18, and was later reported near $92.
- WTI crude
- Rose above $85 in one report and traded above $84 in another.
- Price trend
- Crude prices gained for a fourth consecutive day; Brent had risen more than 4.5% over the previous three sessions.
- Diplomacy
- Donald Trump said there were no ongoing or scheduled talks with Iran, but later said talks might restart “at some point.”
- UAE measures
- The UAE suspended all trade and financial transactions with Iran until further notice, while another report described the move as cutting all economic ties.
- Missile dispute
- The UAE accused Iran of firing two ballistic missiles; Iran denied the allegation.
- Hormuz shipping
- Traffic through the Strait of Hormuz remained far below normal, although some crude was reportedly being shipped through it.
- US oil data
- Reports cited falling distillate inventories and strong refinery runs, while crude stockpiles increased by 4.4 million barrels in Energy Information Administration data.
Quotes
President Donald Trump
President of the United States
“Speaking to reporters, President Donald Trump maintained that there was “a lot of oil” passing through the Strait of Hormuz.”
livemint.com
“Asked if he would restart talks with Tehran, Trump said “maybe at some point”.”
livemint.com
Sources
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