Oil prices held steady in early Asian trade on Thursday as investors weighed the outlook for the US-Iran war and the continuing uncertainty over shipping through the Strait of Hormuz.
Brent crude futures for October delivery rose 25 cents, or 0.3%, to US$91.87 a barrel by 0037 GMT. US West Texas Intermediate (WTI) crude for September slipped two cents to US$85.81 a barrel, while the more active October contract gained 14 cents, or 0.2%, to US$84.53.
Both Brent and WTI settled higher for a fourth consecutive session on Wednesday, reaching their highest levels since July 24. The September WTI contract is due to expire later on Thursday.
The latest gains have kept oil prices elevated as traders continue to assess geopolitical risks in the Middle East, particularly the uncertainty surrounding peace talks and the status of the Strait of Hormuz.
“Oil prices remained elevated as the market is supported by sporadic attacks in the Middle East but lacks fresh momentum without a major escalation,” said Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, a unit of Nissan Securities.
“The market is likely to maintain a gradual upward trend given uncertainty over peace talks and tensions involving the United Arab Emirates, Oman and Iran,” he added.
The focus on regional tensions intensified after the United Arab Emirates suspended all financial and economic transactions with Iran until further notice, putting relations between the Gulf oil producer and Tehran back in the spotlight.
US President Donald Trump said on Tuesday that no talks were taking place with Iran and that the Strait of Hormuz was open. Iran, however, maintained that the strategic waterway remained closed.
Shipping activity through the Strait of Hormuz has also slowed, with data showing that most shipowners continued to avoid the key route amid a lack of clear signals over its reopening following a blockade imposed during the war.
The waterway remains critical to global oil markets, making any disruption to shipping a key risk for prices.
Meanwhile, US inventory data offered a mixed signal for the oil market. The Energy Information Administration said crude and gasoline inventories increased last week while distillate stockpiles declined.
US crude inventories rose by 4.4 million barrels in the week ended August 14, sharply contrasting with expectations for a 600,000-barrel draw.
