Crude oil hovered near $95 a barrel on Thursday, pulling back from an earlier spike to $97 amid indications that the United States and Iran may be moving toward a deal to restore Persian Gulf oil exports. Media reports said US and Iranian negotiators are exploring an agreement that would lift naval blockades on tankers transiting the Strait of Hormuz and ease US sanctions on Iran.
The market had surged earlier after Iran-aligned Houthi militants in Yemen launched missile attacks on several Saudi cities, including Yanbu and Taif. Yanbu, on Saudi Arabia’s Red Sea coast, is a critical oil export terminal. As a result, Saudi Arabia’s alternative export route that avoids the Strait of Hormuz now faces war-risk insurance premiums nearly as high as those for tankers sailing directly through the strait.
On Wednesday, only 10 commodity vessels passed through the Strait of Hormuz, well below the 10-day moving average of 17, highlighting the disruption. In Washington, the US Senate narrowly voted down a nonbinding resolution calling for an end to the war with Iran, underscoring ongoing political divisions over the conflict.
