Oil Prices Rise Above $91 as Iran War Threatens Hormuz Flows

Oil prices rose on Tuesday as hopes for a deal to end the conflict in the Middle East weakened, raising concerns about global energy supplies.

Brent crude futures increased by 27 cents, or 0.3%, to $91.14 a barrel by 0003 GMT. US West Texas Intermediate (WTI) crude rose 42 cents to $85.04 a barrel.

The rise came after Iran said it could adopt a more offensive military position as efforts to reach a permanent end to the conflict with the United States stalled. Washington has also ruled out extending a temporary ceasefire.

The situation has created fresh concerns over the Strait of Hormuz, a major route for global oil shipments. Shipping traffic through the strait has dropped sharply following attacks on tankers.

According to ship-tracking data from Kpler, only five commodity vessels passed through the Strait of Hormuz on Saturday, compared with 31 during the previous weekend. No commodity vessels were recorded passing through the strait on Sunday.

Market analysts said the uncertainty around the Strait of Hormuz and the Bab el-Mandeb has increased concerns about possible disruptions to energy supplies.

Iran is also holding talks with Oman over an arrangement to manage traffic through the Strait of Hormuz and says the discussions are close to an agreement. However, US President Donald Trump has threatened military action against Oman over the talks.

There were also reports that Trump had opened back-channel discussions with Iran’s Islamic Revolutionary Guard Corps, raising some hope that diplomatic efforts could continue.

Meanwhile, Yemen’s Houthi group said it attacked what it described as a Saudi military ship and four escort vessels in the Red Sea.

In the United States, crude oil inventories were expected to have declined last week, according to a preliminary Reuters poll. A fall in oil and fuel stockpiles could provide further support to crude prices.