West Texas Intermediate (WTI) oil price gains ground after opening at levels below the previous close, trading around 95.60 during the Asian hours on Friday. Crude oil prices gain on rising supply concerns amid stalled US-Iran peace negotiations and the continued closure of the Strait of Hormuz.
Bloomberg reported on Thursday that the US military intercepted two Iranian oil supertankers attempting to evade its blockade, as Washington presses ahead with efforts to curb Iran’s shipping while Tehran continues to threaten vessels in the Strait of Hormuz. US military officials are also preparing contingency plans to target Iran’s capabilities in the strait should the current ceasefire collapse.
US President Donald Trump warned that if Iran does not move its oil, its infrastructure could be targeted. Iranian officials, however, rejected claims of any truce extension and accused Washington of violating the agreement by maintaining a naval blockade on Iranian trade.
Iran on Thursday released footage showing commandos in a speedboat boarding a large cargo vessel following the breakdown of peace talks, underscoring its control over the Strait of Hormuz, a route through which roughly 20% of global oil and gas supplies typically pass.
Reuters, citing Mingyu Gao, chief researcher for energy and chemicals at China Futures, noted that prolonged disruptions in the Strait of Hormuz could drive global crude and refined product inventories below five-year seasonal lows by late May or early June, reintroducing a supply-risk premium into oil prices.
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