Oil Rallies for 4th Session Amid Supply Disruption Fears
Oil prices strengthened again during Wednesday's trading (Aug 19), marking a rise for the fourth consecutive session. Brent crude rose approximately 0.3% to US$91.32 per barrel, while WTI gained 0.4% to reach US$85.28. Both benchmarks are currently hovering near three-week highs, underpinned by concerns that US-Iran tensions could keep global supplies tight in the coming months.
The primary factor remains the situation in the Strait of Hormuz. Shipping data indicates that tanker traffic through this strategic waterway continues to decline. Only six commodity vessels passed through on Tuesday—down from nine the previous day and below the 10-day daily average of 11 ships. This drop in activity has heightened market concerns regarding the smooth flow of energy exports from the Gulf region.
Diplomatic tensions also show no signs of easing. US Secretary of State Marco Rubio reportedly discussed Gulf security and freedom of navigation in the Strait of Hormuz with the United Arab Emirates' national security advisor. Meanwhile, President Donald Trump emphasized that no talks with Iran are currently underway or scheduled.
Iran has also denied the existence of negotiations with Washington and rejected US claims that the Strait of Hormuz has reopened. Tehran stated that the waterway would remain closed until the US meets specific requirements outlined in an interim agreement that has since expired. The expiration of that agreement framework, with no signs of renewal, keeps geopolitical risks elevated.
Additional support for oil prices came from an American Petroleum Institute (API) report showing a slight decline in US crude oil inventories last week. These data raised expectations that the official EIA inventory report might also show a drop. Shrinking US stockpiles serve as a further signal that domestic supply conditions could tighten, particularly amid pressure on strategic oil reserves.
Newsmaker Analysis: The bias for oil remains bullish as long as uncertainty surrounding the Strait of Hormuz persists and US stockpiles continue to decline. Brent has the potential to hold above the US$90 level and retest the US$92–US$93 range should shipping disruptions worsen. However, given that prices have risen for four consecutive sessions, the market is also becoming vulnerable to profit-taking if EIA data reveals a rise in inventories or if signs of de-escalation between the US and Iran emerge. (arl)
Source: Newsmaker.id
