Deal Elusive: Is Brent Set to Break Through US$85?
Oil prices strengthened again during Monday's trading (Aug 10) after Iran and Oman failed to reach a final agreement to reopen the Strait of Hormuz. Brent rose approximately 1.5% to US$84.81 per barrel, while WTI gained 1.5% to around US$79.39.
Iran had previously stated that a deal with Oman was "very close." However, Tehran reiterated that reopening Hormuz requires the lifting of the US blockade on Iranian shipping and the payment of compensation for war-related losses.
US President Donald Trump has opted for a more patient approach, stating that Washington is easing military pressure. Yet, this strategy leaves the reopening of Hormuz in limbo, as there are no signs of the two sides reaching common ground anytime soon.
Ship traffic through Hormuz remains very low. Currently, only about five vessels pass through daily—far below the approximately 14 ships per day seen after the interim agreement in June. The market views an increase in vessel numbers as a key indicator that energy supplies are truly beginning to normalize.
Security risks remain high following reports that an ADNOC tanker was targeted in Hormuz. The Houthi group also claimed an attack on Saudi Arabia's Jazan refinery. The appointment of hardliner Mohsen Rezaee to a top Iranian security post has further fueled concerns that Tehran will not easily loosen its grip on the strait.
Newsmaker Analysis: Oil sentiment remains bullish as long as ship traffic through Hormuz fails to return to normal. Brent could trade within the US$80–US$90 range while uncertainty persists. A clear agreement could trigger a price correction, but a breakdown in negotiations or fresh attacks could push Brent past the US$85 mark and drive prices even higher. (arl)
Source: Newsmaker.id
