Oil rises as doubts over US-Iran deal heighten supply concerns

Crude prices climbed on Wednesday, with traders reacting to uncertainty over a US-Iran peace agreement and attacks on two vessels. Business Recorder reported that Brent futures added 75 cents, or 0.84 per cent, reaching $89.66 per barrel at 0553 GMT, while US West Texas Intermediate rose 72 cents to $83.92. Both had at one point traded more than $1 higher during the day.

Prices had jumped about 5 per cent on Monday after Trump demanded that Iran pay compensation over deaths in wars, attacks and protests. Mohsen Rezaei, described as Iran's leading security official, said that Hormuz would remain closed until Washington met Tehran's conditions for ending the war. Tuesday saw only eight vessels transit Hormuz, a one-week low, compared with 125 to 140 daily before the war.

Figures from the American Petroleum Institute, reported by market sources, showed US crude stocks grew by about 9.1 million barrels for the week to August 7, while gasoline and distillate stocks fell by 1.5 million and 596,000 barrels. Haitong Futures said the build, which far exceeded expectations, could ease supply worries if the EIA confirms it. Official EIA figures are due at 1430 GMT on Wednesday. The EIA projects Middle East crude supply disruption of roughly 600,000 barrels daily to last until the close of 2027.