WASHINGTON (dpa-AFX) - Recovering from earlier losses in the session, crude oil prices have moved higher on Friday as signals of war risk continued after U.S. President Donald Trump refused to rule out renewing attacks on Iran. This overshadowed the positivity from reports hinting that Qatar is speeding up the efforts to clear way for U.S.-Iran peace process.
WTI Crude Oil for December delivery was last seen trading up by $0.46 (or 0.51%) at $90.98 per barrel
Investors are yet to receive clarity on how the U.S. administration plans to defuse the Middle East crisis and figure out a way to permanently end all hostilities with Iran.
Trump suffered a setback this week when the midterm election results showed that the Democratic party seized control of the House and Senate.
While Trump remarked that Iran was partly responsible for the jolt, U.S. Vice President JD Vance conceded that Iran war was the primary reason for the defeat.
The war with Iran, which began in late February and is in its ninth month now, has rattled energy markets around the world after Iran closed the Strait of Hormuz.
Prior to the elections, reports indicated a possible renewal of attacks on Iran by the U.S. on a grand scale after the elections.
Defiant Iran responded by stating that Iran could combat any attack by any aggressor and would strike back, ignoring geographical boundaries.
However, the results indicated that public support shifted in favor of the Democrats as U.S. households could not bear the squeezing on their budgets due to oil-linked inflation as a consequence of the U.S.-Iran war that Trump started.
Despite conquering Congress, the Democrat-elects have to wait until January to assume office. This period offers more than 60 days for Trump to either carry out the attacks as planned or attempt to solve the crisis through negotiations or as a third option enforce the current economic blockade for an extended period without ordering withdrawal of troops.
Yesterday, Trump stated that the world will soon know his decision on the possibility of a deal with Iran. Declining to rule out military option, Trump maintained that he could destroy what is left of Iran.
Trump replaced White House Chief of Staff Susie Wiles with Stephen Miller who was the Deputy Chief of Staff. Of note, in April, Miller remarked that if Iran refused a deal, the U.S. blockade could continue without an end. As a last resort, he also suggested the destruction of Iran's energy infrastructure.
Reuters reported, citing an Iranian official, that Iran had sent a nuclear proposal to the U.S. through Qatar, with a precondition that a discussion will not begin until Iran's conditions are met by the U.S.
While Iran wants the lifting of U.S. sanctions, release of frozen Iranian assets in foreign countries, and adequate compensation for war losses, the U.S. wants a halt to Iran's nuclear program.
Today, Qatar officially stated that the Emir of Qatar, Sheikh Tamim bin Hamad Al Thani had a discussion with Trump over phone about de-escalation.
Causes of concern continue to remain as the Strait of Hormuz shipping traffic is still under threat.
The United Kingdom Maritime Trade Operations reported an explosion on an oil tanker on its port side, 16 nautical miles east of Khasab, Oman, in the Strait of Hormuz yesterday.
The Islamic Revolutionary Guards Corps announced that two oil tankers that tried to transit the Strait of Hormuz through unauthorized routes struck mines.
While one tanker was hit in the eastern part of the strait, the other was struck within the strait itself. Soon after hitting the mines, the vessels caught fire.
The IRGC re-asserted Iran's stance that the strait will remain closed until Iran's conditions are fully met.
Even while the uncertainty over the U.S. strategy to deal with Iran continued to add geopolitical risk premium and pushed oil prices higher, expectations on a possible diplomatic solution partly offset the fears.
Today's economic data in the U.S. revealed stronger-than-expected payroll numbers.
The U.S. dollar index was last seen trading at 102.28, up by 0.70 (or 0.69%) today.
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