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

Oil prices moved higher early on Wednesday as traders weighed doubts about a prospective peace settlement between Washington and Tehran. Attacks on two ships added to supply anxiety in the Middle East. Brent futures rose 72 cents to $89.63 per barrel, a 0.81% gain, while West Texas Intermediate added 71 cents to reach $83.91.

Both benchmarks ended Tuesday more than a dollar higher, their strongest finish since July 31, extending a rise of roughly 5% recorded on Monday when hopes for a settlement began to fade. Washington and Yemen's Houthis each reported attacks on vessels in the Hormuz and Bab el-Mandeb waterways. Iran's security chief Mohsen Rezaei said the Strait of Hormuz would stay shut unless Washington met Tehran's terms, which include releasing frozen Iranian assets.

Market sources, citing American Petroleum Institute data, said US crude stocks climbed by about 9.1 million barrels in the week to August 7, while gasoline and distillate inventories declined. Haitong Futures said that if the EIA report due later on Wednesday confirms the build, it could ease worries about tight supply. Looking further ahead, the EIA expected roughly 600,000 barrels a day of Middle East crude supply to remain disrupted through the end of 2027.