WASHINGTON (dpa-AFX) - Partially covering the losses from two previous sessions, crude oil prices have surged on Wednesday after strong remarks by Iranian leaders against the U.S. diminished expectations of an early reopening of the Strait of Hormuz.
WTI Crude Oil for December delivery was last seen trading up by $0.96 (or 1.12%) at $87.00 per barrel.
The U.S.-Iran war, the closure of Strait of Hormuz by Iran, the eventual supply disruption, and the effects of oil-linked inflation on U.S. household were stated as the reasons for the Republican party's setback in the last week's midterm elections.
On Sunday, U.S. President Donald Trump stated that there would not be a need for further attacks on Iran as the efforts for ending the U.S.-Iran war were showing progress.
Yesterday, through Truth Social, Trump messaged that he was seeing positive momentum towards ending the conflict.
Trump confirmed that the economic and naval blockade against Iran would go on but did not see the necessity for renewed strikes. However, he asserted that U.S. forces are locked, loaded, and ready to go on when needed.
U.S. Secretary of State Marco Rubio also echoed Trump's views. He remarked that there was no need for military combat against Iran since the economic blockades are exerting enough pressure on Iran.
With the U.S. softening its stance, chances for an agreement heightened and crude oil prices declined.
However, late yesterday, in an interview with Al Mayadeen TV of Lebanon, the Secretary of Iran's Supreme National Security Council Major General Mohsen Rezaei denied any meetings between officials of the U.S. and Iran.
Despite the U.S. easing its position, Rezaei sounded aggressive and warned against 'deceptive statements' by U.S. officials. He stated that the U.S. indulged in such false claims to bring down oil prices and ease the economic pressure.
Rezaei remarked that Iran submitted its seven conditions to the U.S. to reopen the strait and is still waiting for the U.S. response.
Speaking on Iran's nuclear ambitions, Rezaei vowed that Iran would not allow the removal of even a single particle of enriched nuclear material out of the country. He also warned that any fresh military offensive on the nation would trigger far more deadly blows.
With Iran taking a confrontationist stance, geopolitical risk premium returned to crude oil prices.
Today, Iran reported that a tanker that swayed into a restricted area in the eastern part of the Strait of Hormuz hit a naval mine and caught fire.
Separately, the United Kingdom Maritime Trade Operations reported about an incident involving a tanker in the crucial waterway though it is unclear if it refers to the same vessel.
Yesterday, a spokesperson for the Iran-aligned Houthi militant group of Yemen claimed that the rebels targeted King Khalid International Airport as well as several pumping stations along Saudi Arabia's East-West pipeline. Saudi Arabia is yet to officially confirm these attacks.
On the inventory front, data from the American Petroleum Institute showed that crude oil inventories rose by 9.00 million barrels for the week ending November 6, defying market forecasts for a 1.00 million-barrel decline and reversing a 5.267 million-barrel drop in the previous week.
The Organization of Petroleum Exporting Countries left the global oil demand growth forecasts for 2026 and 2027 unchanged at 2.55 million barrels per day.
OPEC's monthly report also highlighted a notable increase in Saudi Arabia's oil output. The volumes have reached 10.56 million bpd in October, marking a 26% increase.
Total OPEC+ crude output has now increased by 2.04 million bpd to 41.23 million bpd in October.
Yesterday, the inflation data from the U.S. for October showed a significant rise.
Amid the ongoing uncertainty on the reopening of the Strait of Hormuz, several senior Federal Reserve officials have spoke in favor of at least a quarter point interest rate hike in December.
The bets for a quarter-point rate hike now stand at 87.10%, according to CME Group's FedWatch Tool. The odds on a 50-basis-point hike hover around 12.90%.
The U.S. dollar index was last seen trading at 102.91, up by 0.68 (or 0.67%) today.
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