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Oil rises for fourth straight day amid renewed Strait of Hormuz risk
Brent was above $85 per barrel in early Europe trade, as prices have gained about 12% since last Friday and Iran threatened additional export corridor closures.
Oil prices rose for a fourth consecutive trading session on Wednesday as renewed tensions tied to the Strait of Hormuz raised fears of further disruptions to crude shipments. In early Europe trade, Brent was up about 0.83% and staying above $85 per barrel, while the U.S. benchmark, WTI, was above $80 after climbing roughly 0.89%.
U.S. and Iranian actions escalated hostilities over the weekend, with Iran striking tankers in the Strait of Hormuz, and the U.S. hitting Iranian targets while reinstating a naval blockade. As the blockade went live early Wednesday Middle Eastern time, Iran’s Islamic Revolution Guards Corps warned it could close export corridors that benefit the U.S. and its allies, according to Iranian media cited by Reuters.
By Wednesday, oil had been climbing since last Friday for a total gain of about 12% as of Tuesday’s close, after a steady rise shifted into a reduction of tanker traffic through the chokepoint as hostilities returned.
The risk is not limited to Hormuz. Analysts cited in the article warned that Iran-aligned Houthis could be used to block the Bab el-Mandeb Strait, a major chokepoint between Yemen and the Horn of Africa that connects the Red Sea to the Gulf of Aden, potentially affecting Saudi Arabia’s key crude export terminal at Yanbu.
Latest closeWTI crude $79.90 ▲2.2%|Brent $85.36 ▲2.5%