Crude oil prices moved higher today as the chances of a lasting peace between the United States and Iran shriveled following Iran’s release of six conditions earlier this week and President Trump’s unsurprising reaction to them.
At the time of writing, Brent crude traded at $87.72 per barrel, and West Texas Intermediate was trading at $82.13 per barrel, after President Trump demanded that Iran pay reparations to the U.S. for war-related damages.
“We’re going to ask for money for the damage they’ve done over a 50-year period,” Trump told media at the White House earlier this week, adding that “So if there’s damages to be paid, I think Iran should pay those damages,” and that “Also, with respect to the Iran negotiations, Iran should be responsible for the damages and death caused to the people of Lebanon, Syria, Yemen, and Gaza!”
Iran, meanwhile, said it was getting closer to finalizing its deal with Oman regarding their joint management of the Strait of Hormuz, noting that the conditions for reopening the waterway were still in force and Hormuz will remain shut down until the U.S. fulfils the conditions listed by Tehran earlier this week.
“There appears to be a gulf, no pun intended, between the U.S. and Iran over what any agreement would actually look like,” KCM Trade chief market analyst Tim Waterer said as quoted by Reuters.
“Current rhetoric suggests any potential deal is still some way off, meaning risks remain skewed to the upside for oil prices,” ING commodity strategists wrote in a note today. They added, however, that “Oil continues to move through the Strait of Hormuz even as disruptions persist, underscoring the market’s ability to keep flows moving despite periodic turbulence.”
Tankers are turning off their transponders to pass through the Strait of Hormuz, with Iraq reporting average daily export rates of 2 million barrels, Warren Patterson and Ewa Manthey noted.
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com
- Indian Refiners Cut LPG Losses in August
- Russia Rebuilds Nuclear Workforce at Iran’s Bushehr Plant
- Egypt and Libya Near $1 Billion Oil Pipeline Deal
