Oil prices rise after reports of container ships in Hormuz being hit by gunfire
Brent crude futures surpassed US$100 a barrel earlier in the day.
A pump jack operates near a crude oil reserve in the Permian Basin oil field near Midland, Texas, US on Feb 18, 2025. (Photo: Reuters/Eli Hartman)
LONDON: Oil prices rose on Wednesday (Apr 22), erasing earlier losses following reports of gunfire attacks on at least three container ships in the Strait of Hormuz.
Brent crude futures were up US$0.73, or 0.7 per cent, at US$99.21 a barrel at 10.49am GMT (6.49pm. Singapore time).
Earlier in the day, it had been trading at above US$100 a barrel.
West Texas Intermediate futures rose US$0.59, or 0.7 per cent, to US$90.26. Both benchmarks climbed about 3 per cent on Tuesday.
At least three container ships were hit by gunfire in the Strait of Hormuz on Wednesday. Iran's Revolutionary Guards Navy seized two vessels for what it described as maritime violations and transferred them to Iranian shores, the semi-official Tasnim news agency reported.
Iran and the US have imposed restrictions on ships using the strait, which until the Iran war began at the end of February, had carried about 20 per cent of global oil and liquefied natural gas supplies.
Earlier, US President Donald Trump had said he would indefinitely extend the ceasefire with Iran, hours before its expiry, to allow talks to continue to end a war that has killed thousands and shaken the global economy.
DOUBTS OVER WHETHER ISRAEL AND IRAN WILL AGREE
The announcement appeared to be unilateral, and it was not immediately clear whether Iran, or US ally Israel, would agree to extend the truce, which began two weeks ago.
In Europe, Ukrainian President Volodymyr Zelenskyy said the Druzhba oil pipeline pumping Russian oil, is ready to resume operation.
Three industry sources, however, said Russia is set to stop oil exports from Kazakhstan to Germany via the Druzhba pipeline starting on May 1.
Later on Wednesday, the US Energy Information Administration will publish inventory data. Crude oil inventory fell by 4.5 million barrels last week, while gasoline and distillate stocks also declined, market sources said, citing American Petroleum Institute figures.
Analysts estimated a 1.2 million-barrel draw of crude for the week ended Apr 17.
"If the EIA confirms the draws and US weekly exports of both crude oil and refined products remain robust, this will be taken as confirmation that consumers in Europe and the Far East are scrambling to secure oil supplies wherever, whenever, and however they can," PVM analysts said.
