WASHINGTON (dpa-AFX) - Paring the gains made earlier, crude oil slid later in the session but rebounded on Wednesday as investors analyzed Iraq's resumption of production. Profit-booking by traders to monetize from yesterday's surge limited the upswing.
WTI Crude Oil for April delivery was last seen trading down by $0.18(or 0.19%) at $96.39 per barrel.
After halting production due to the disruption of traffic in the Strait of Hormuz, Iraq announced the resumption of oil exports from northern Kirkuk province to a limit of 250,000 barrels per day through the Port of Ceyhan in Turkey after striking an agreement with the autonomous Kurdistan Regional Government. Iraq is planning to pump around 100,000 barrels per day through the port.
The U.S.-Israel war against Iran, which began on February 28, has resulted in the closing of the Strait of Hormuz, a vital artery for global oil transit through which more than 20% of the world's crude oil and natural gas are transported.
Iran controls the northern shore of the Strait of Hormuz. More than 100 ships passed through the strait daily before the start of war. The number plunged to 21 tankers following the war.
Maritime intelligence firm Windward reported around 400 vessels stranded near the Gulf of Oman. However, a few ships linked to China, Greece, India, Pakistan, and Turkey were permitted to sail.
After U.S. President Donald Trump's call to his allies to join a U.S.-led coalition to protect the strait found no takers, Trump called out the allies for their reluctance to support the U.S. Several NATO countries expressed their unwillingness to join hands with the U.S. as they were not consulted prior to the attacks.
With no sign of a ceasefire in the ongoing war between the U.S.-Israel combined forces and Iran, yesterday Israel announced the killing Iran's Chief of Security Ali Larijani and Basij Force Commander Gholamreza Soleimani. Iran confirmed their deaths and avowed fierce retaliation.
The International Atomic Energy Agency stated that Iran informed the agency that a projectile attack targeted the Bushehr Nuclear Power Plant yesterday with no damage to the facilities or human casualties.
Today, Israel's Defense Minister Israel Katz announced that in an overnight attack conducted by the Israeli Defense Forces, Iran's Intelligence Minister Esmail Khatib was killed. In a 'revenge attack,' Iran fired cluster missiles at central Israel.
Reuters quoted a senior Iranian official who stated that Iran's new Supreme Leader Mojtaba Khamenei has rejected any diplomatic route to end the war and is reportedly taking a harsh retaliatory stance to avenge those who were killed.
Due to production and supply disruption concerns, oil prices have been increasing.
As a result, inflows into energy funds have gathered steam with the total market capitalization of the top 25 global oil firms so far increasing to $5.30 trillion (20% higher).
On the inventory front, data from the American Petroleum Institute revealed that U.S. inventories rose by 6.6 million barrels for the week ending March 13 versus expectations of a 0.6-million-barrel decline.
According to the U.S. Energy Information Administration, for the week ending March 13, crude oil inventories in the U.S. increased by 6.16 million barrels to 449.3 million. At the Cushing, Oklahoma delivery hub, crude oil inventories climbed by 944,000 barrels.
For the same period, gasoline inventories declined by 5.436 million barrels (higher than the expected 1.6-million-barrel fall), distillate inventories decreased to 2,527,000 barrels, and heating oil inventories declined by 0.081 million barrels.
The U.S. Federal Reserve left the interest rate steady in the 3.50% to 3.75% target range for a second consecutive meeting, in line with expectations.
The U.S. dollar index was last seen trading at 99.78, up by 0.23 points (or 0.23%) today.
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