Crude oil prices climbed on Wednesday after US President Donald Trump ruled out easing sanctions on Iran, renewing supply concerns as the market continues to weigh recovering Middle East exports against the risk of further disruption around the Strait of Hormuz.
As at the time of writing 07:50 (WAT), Brent crude traded at $103.30 per barrel, gaining 0.66%, while WTI crude stood at $89.69 per barrel, up 0.35%.
The latest increase follows a modest decline earlier in the week after reports showed that oil flows from the Persian Gulf had recovered towards pre-war levels. However, uncertainty over whether the recovery can be sustained has continued to support prices.
According to the Oilprice.com report, continued uncertainty around sanctions relief and negotiations is keeping a geopolitical risk premium in the market. Improving supply could limit further price gains, but renewed disruption or an escalation in tensions could put additional upward pressure on crude.
Kpler data cited in the report indicated that oil flows through the Strait of Hormuz had recovered to about 13.2 million barrels per day, representing roughly 77% of pre-war levels. Another Reuters-cited Kpler estimate put Hormuz flows at 7.4 million barrels per day, while total Middle East oil exports were estimated at 12.8 million barrels per day.
Despite increased vessel traffic through the Strait, flows remain below pre-conflict levels, according to UBS commodity analyst Giovanni Staunovo, as cited in the report. The shortfall means the global market continues to face supply constraints despite the recent recovery in exports.
The continued risk to tanker movements through the Strait of Hormuz is also keeping pressure on the market. While higher export volumes have eased some supply concerns, the possibility of renewed disruption remains an important factor behind the elevated crude price levels.
For the month, Brent is on course to record a gain of about $10 per barrel, while WTI is set for an increase of roughly $3 per barrel, according to the report. The latest price movement therefore reflects a market still balancing recovering supply flows against unresolved geopolitical and shipping risks.