Follow: Live updates on the US-Iran war
Oil prices rebounded on Wednesday, with Brent climbing back above $80 a barrel after Yemen's Houthi rebels attacked a Saudi oil tanker in the Red Sea, reigniting concerns over Middle East supply risks despite renewed talk of US-Iran negotiations.
The benchmark for two-thirds of the world's oil was up 1.49 per cent at $80.54 a barrel at 5.12pm UAE time. West Texas Intermediate, the gauge that tracks US crude, added nearly 1 per cent to $76.46 per barrel.
On Tuesday, amid conflicting claims on peace talks between Washington and Tehran, Brent and WTI sank by more than 5 per cent. Brent went below $80 for the first time since the second week of July, even flirting with $77, before a late surge saw it settle at $80.100. Brent was in and out of the $79 range on Wednesday.
US President Donald Trump on Monday said Washington was restarting talks with Tehran, claiming the latter was keen to forge a deal. But Iran quickly denied that, saying its only active discussions were with Oman on the reopening of the Strait of Hormuz.
That was the third such "imminent deal" announcement from the US leader in recent days, "following a pattern of strikes continuing despite pauses being declared", analysts at Dubai-based investment services firm Asas Capital noted.
On Wednesday, Houthi rebels struck the Saudi oil tanker Wafa in the northern Red Sea, off the coast of Yanbu, with several ballistic missiles. The group's spokesman, Yahya Saree, claimed the strike on the tanker Wafa was "precise" but provided no details on damage or casualties. Saudi authorities have yet to release a statement.
Also continuing to be a sticking point is the Strait of Hormuz, where tensions remain high in the key chokepoint for energy exports from the Middle East.
At the Bab Al Mandeb strait, which connects the Red Sea to the Gulf of Aden and the Indian Ocean, two Pakistan-flagged crude tankers were able to safely transit after loading at Saudi Arabia’s Yanbu port, according to data from the maritime intelligence firm Windward, despite threats from Houthi rebels to attack Saudi-linked ships.
"For a region that ships roughly a fifth of global oil supply through [the Strait of Hormuz], this is the number to watch: further escalation risks a genuine supply shock; a ceasefire or diplomatic off-ramp could unwind much of this move quickly," Asas analysts added.
The ripple effects of the war on global oil prices have made it difficult for governments, energy companies and analysts to project where the market is heading.
On Sunday, Opec+ agreed to increase crude oil output for a sixth consecutive month in September, pledging that the group will continue to monitor developments and act accordingly.
