KEY POINTS
- Brent crude rose 1.1% to $92.53 per barrel on Nov. 11.
- At least 37 ships came under attack in October, according to the Washington Institute for Near East Policy.
- Uncertainty over US-Iran diplomacy continues to influence oil market movements.
Oil prices recovered on Wednesday, Nov. 11, after falling to their lowest levels in two months, as renewed attacks on shipping in the Strait of Hormuz weakened expectations of an easing in the US-Israeli war on Iran.
Brent crude futures climbed $1.04, or 1.1%, to $92.53 per barrel, while US West Texas Intermediate crude gained 67 cents, or 0.8%, to $86.71, according to Reuters.
The rebound followed a sharp decline during the previous trading session, when prices initially dropped by more than $3 per barrel amid signals from US officials that further military action against Iran might not be necessary.
However, concerns over the safety of commercial vessels in the Gulf quickly returned to the market.
Hormuz shipping risks keep traders cautious
The Strait of Hormuz remains a critical route for international energy supplies, making disruptions in the waterway a major concern for oil producers, shipping companies and consumers.
According to data from the Washington Institute for Near East Policy cited by Reuters, 37 vessels came under attack in October. That represented the highest monthly total since the Middle East conflict began.
Meanwhile, reports of further incidents in November suggest that shipping risks have not eased.
A tanker was reportedly struck by an unidentified projectile northeast of Oman. In addition, Iran’s state broadcaster reported that two tankers caught fire after hitting naval mines while travelling through the strait on what Iranian authorities described as unauthorised routes.
These incidents have complicated expectations that diplomatic progress could quickly restore confidence in regional shipping.
Iran negotiations remain a major market factor
Meanwhile, uncertainty surrounding possible negotiations between Washington and Tehran continues to influence trading decisions.
Oil prices initially declined after US officials played down the prospect of additional strikes. However, prices recovered some losses after an Iranian security official said no negotiations were taking place between the two sides.
Reuters also reported that Iran’s security chief had rejected the possibility of allowing enriched nuclear material to leave the country, highlighting the differences that remain between both sides.
Although traders are watching for signs of de-escalation, the prospect of a diplomatic agreement does not necessarily mean shipping operations will return to normal immediately.
According to market analysts, mine clearance, insurance costs and shipowners’ willingness to resume normal operations could all affect the pace of recovery.
Separately, a drone attack caused a fire in the Russian Baltic Sea port of Ust-Luga, injuring three workers, according to a regional governor.
For oil markets, the combination of geopolitical uncertainty and shipping disruptions continues to create competing pressures on prices.
