Oil prices held nearly steady Monday after last week's decline on hopes the Strait of Hormuz could reopen. Iran said a deal with Oman was nearing completion but tied any reopening to U.S. compensation for its attacks, while a Houthi strike on a Saudi Aramco refinery added fresh supply risk.
Oil prices barely moved Monday as optimism over reopening the Strait of Hormuz ran into Iran's insistence that Washington first meet several conditions. Brent crude stood at $83.54 a barrel, off 1 cent, by 0643 GMT. U.S. WTI crude fell 15 cents, or 0.2%, to $78.03 a barrel.
Both benchmarks had fallen more than 7% last week on hopes that Iran and Oman were close to a deal that would reopen the strait. The waterway carried a fifth of the world's oil before the war.
Iran said Sunday that a deal with Oman had reached its final stages, but it repeated that the waterway would reopen only once Washington met other conditions, including compensation for U.S. attacks on Iran. Iran and the U.S. are not currently in talks, and Tehran will not start them as long as Washington breaches an interim deal signed in June, Iranian Foreign Minister Abbas Araqchi said Sunday.
As Sugandha Sachdeva, founder of the New Delhi-based research firm SS WealthStreet, put it: "Crude oil prices remain caught between opposing forces", as markets weigh a possible breakthrough against Iran's conditions.
The Iran-aligned Houthis said they hit Saudi Aramco's Jazan refinery on Sunday, a further threat to supply. The attack came two days after Saudi Arabia signed a defence pact with Turkey and Pakistan in response to growing regional instability from the U.S.-Israeli war on Iran.
Separately, the United Arab Emirates' ADNOC said 15 of its vessels had been attacked transiting the Strait of Hormuz since the conflict began. Sachdeva added that major progress toward restoring unrestricted shipping could pressure prices lower, while a breakdown in talks or renewed supply disruptions could quickly revive the geopolitical risk premium.
Source: Commodities & Futures News
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