WASHINGTON (dpa-AFX) - Following three days of gains, crude oil prices have shown another substantial move to the upside on Wednesday as supply disruption concerns deepen after the U.S. attacked several Iranian targets for the 11th straight night while endeavors by intermediaries to reach a truce between both the nations are at a standstill.
WTI Crude Oil for September month delivery was last seen trading up by $2.62 (or 3.11%) at $86.96 per barrel.
In the ongoing Middle East crisis, the U.S. military concluded its 11th night of attacks on several Iranian targets.
On Monday, citing a senior official, Reuters reported that mediators have offered Iran a proposal to pause the war with the U.S. with recommendations to halt attacks for 10 days during which both nations would find ways to revive their interim deal signed on June 17.
U.S. President Donald Trump stuck to his hard stance on Iran.
Today through Truth Social, Trump stated that henceforth if Iran fires on any ship in the Strait of Hormuz, then U.S. forces will target a bridge or a power plant located in Iran, even near its capital.
Trump also warned that the U.S. may next target the Pickaxe Mountain where Iran is suspected of piling up enriched nuclear materials, underground.
However, U.S. Secretary of State Marco Rubio adopted a more softline approach today.
Speaking at the ASEAN meeting of foreign ministers in the Philippines, Rubio lamented that the U.S. is willing to negotiate an end to the current crisis but Iran was not serious about talks.
Reiterating that the U.S. prefers a diplomatic solution, Rubio observed that if Iran continues to remain uninvolved, the U.S. will do what is necessary to protect the interests of the U.S. and its gulf allies.
Rubio stressed that allowing Iran to control the Strait of Hormuz would set a dangerous global precedent.
On Monday, Yemen's Iran-backed Houthi militia threatened to impose a naval blockade on Saudi Arabia, triggering concerns of an extended supply side disruption in the Persian Gulf.
The Strait of Hormuz traffic is now at a standstill as shipowners avoid navigating the corridor.
On the inventory front, data from the American Petroleum Institute revealed that U.S. crude oil inventories posted an unexpected build of 2,603,000 barrels for the week ending July 17 compared with market expectations for a 1,500,000-barrel draw after a 564,000-barrel decline over the previous week.
Commercial crude inventories excluding the Strategic Petroleum Reserve have fallen by more than 57,000 barrels over the past 13 weeks and remain about 7,000 barrels lower year-to-date. The SPR declined by another 5,100,000 barrels to 316,500,000.
According to the U.S. Energy Information Administration, for the week ending July 17, crude oil inventories in the U.S. increased by 2,011,000 barrels. At the Cushing, Oklahoma delivery hub, inventories decreased by 674,00 barrels.
For the same period, gasoline inventories increased by 765,000 barrels, distillate inventories increased by 1,395,000 barrels, and heating oil inventories increased by 231,000 barrels.
Crude oil prices have roughly gained 30% since the beginning of the month and are now up more than 55% since the start of the year.
According to a data from MarineTraffic, only 13 ships crossed the Strait of Hormuz on Monday. On Tuesday, that number came down to 9.
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