Oil prices fall after hitting over one-month high; traders weigh supply risks

Oil prices retreated on Wednesday after an early rally pushed both benchmarks to their strongest levels since July 24, according to Business Recorder. Brent futures lost 57 cents, a 0.60% decline, to trade at $94.08 per barrel at 1135 GMT. U.S. West Texas Intermediate shed 72 cents, or 0.80%, to $89.50, after peaking earlier at $92.29 a barrel. Brent had reached $97.04 during the session.

Traders are weighing the chance of supply disruption after overnight exchanges of fire between the U.S. and Iran, which Washington said it would answer with harsher strikes. Iran's Revolutionary Guards said further U.S. attacks would tighten restrictions on traffic through the Strait of Hormuz, a route that once carried roughly a fifth of globally consumed oil. Two tankers were reportedly disabled by sea mines while trying to cross the strait, according to a statement carried by state media.

U.S. Energy Secretary Chris Wright said 17 million barrels crossed the strait on Monday, the highest volume since the conflict cut flows. Capital Economics noted that ship-to-ship transfers have allowed some exports to continue, but these flows face a high risk from military strikes. Its economist Hamad Hussain added that Brent could rise above $100 if shipping disruption in the Middle East grows.