Brent crude was set for a 6% weekly gain as President Donald Trump said his patience with Iran was running out, despite Iran saying 30 vessels had recently cleared the Strait of Hormuz.
“I am not going to be much more patient,” the U.S. president said in an interview with Fox News on Thursday, as cited by Reuters. “They should make a deal.”
There were hopes the Trump-Xi meeting in Beijing could produce some good news regarding the outlook on the Hormuz situation but so far, no such news has come out of the Chinese capital. Instead, President Trump said China had expressed interest in buying U.S. crude, which added to the bullish sentiment, amid warnings of fast drawdowns in global oil inventories to make up for lost Middle Eastern supply.
“With the Beijing summit not delivering any breakthrough on Iran, market focus is back on the deadlock and a blockaded Strait, with a tail risk of renewed military escalation,” oil analyst Vandana Hari told Reuters earlier today.
Meanwhile, ING’s commodity analysts wrote in a note on Thursday that “Some hope that China could exert pressure on Iran to reach a deal with the US, to end the war and lead to a resumption of energy flows through the Strait of Hormuz.” Warren Patterson and Ewa Manthey added, however, that “The market could be pinning too much hope on the US-China talks yielding some positive results on Iran.”
Iran’s Revolutionary Army Corps said on Thursday that as many as 30 vessels had passed through the Strait of Hormuz since Wednesday. Tehran has encouraged other governments to negotiate deals for the passage of their ships through the chokepoint.
Yet 30 vessels are still way below the usual daily rate from before the war, which stood at an average of 140 vessels. Two of the 30 vessels that cleared the Strait of Hormuz earlier this week were tankers, one en route to Japan and the other headed to China.
By Irina Slav for Oilprice.com
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