Crude Oil Hits Three-Week High as Middle East Supply Risks Intensify

Oil prices continued to rise on Thursday, reaching their highest levels in three weeks as the prolonged war involving Iran and sharply reduced shipping through the Strait of Hormuz heightened concerns over Middle Eastern oil supplies.

At the time of writing, Brent crude futures were trading at $93.95/bbl, up 2.54% on the day, while NYMEX WTI crude was at $88.23/bbl, up 2.80%. Both benchmarks have now recorded gains for five consecutive sessions, with Brent reaching its highest level since late July.

The latest rally comes as efforts to end the conflict remain deadlocked and shipping through the Strait of Hormuz continues at levels significantly below those seen before the war. Before the conflict began with US and Israeli strikes on Iran on February 28, the waterway handled volumes equivalent to around one-fifth of global oil consumption.

Supply concerns were further intensified after the UAE suspended financial and economic transactions with Iran. Trump also warned of economic consequences for countries providing what he described as a “lifeline” to Tehran.

Oil prices also received support from tighter refined-product supplies. According to the Energy Information Administration, US distillate inventories, including diesel and heating oil, fell for a third consecutive week, although crude inventories unexpectedly increased by 4.4 million barrels. With reduced Middle Eastern crude flows reaching refiners and continued uncertainty surrounding the Strait of Hormuz, the oil market remains highly sensitive to any further supply disruptions or escalation in the region.

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