Oil prices were largely unchanged on Wednesday as deadly attacks on vessels in the Red Sea and Gulf of Oman increased concerns over risks to global shipping routes and energy supplies.
Crude Oil Prices Remain Stable Amid Middle East Tensions
Brent crude, the international oil benchmark, gained 7 cents to close at $88.98 per barrel. Meanwhile, U.S. West Texas Intermediate (WTI) crude also rose 7 cents, settling at $83.27 per barrel.
The limited price movement came as markets weighed rising geopolitical risks against signs that diplomatic efforts surrounding the Strait of Hormuz could make progress.
Shipping Attacks Raise Supply Concerns
Iran-backed Houthi rebels killed six people in an attack on a cargo ship in the Bab el-Mandeb Strait on Tuesday. It marked the first reported fatalities linked to attacks on Red Sea shipping routes in more than a year.
Hours later, U.S. forces said they launched missiles at a container ship that allegedly attempted to break Washington’s blockade of Iranian ports in the Gulf of Oman.
The incidents highlight the growing impact of the nearly six-month conflict on two critical global shipping routes, even as negotiations over reopening the Strait of Hormuz show signs of movement.
Markets Await Progress on Hormuz Agreement
José Torres, senior economist at Interactive Brokers, said concerns over Middle East oil supplies remain elevated despite indications that the United States and Iran may be moving closer to an agreement regarding the Strait of Hormuz.
While Pakistan has expressed optimism that Washington and Tehran could reach a deal, Torres said investors are still waiting for concrete developments.
“Investors have been awaiting a deal for a few weeks, and tangible progress is likely required for yields to fall significantly and stocks to rally further at this juncture,” Torres said.
He added that slightly higher oil prices indicate that concerns over supply disruptions caused by the conflict have not yet disappeared.
