Oil prices strengthened on Tuesday (July 7th) following reports of a new attack on the Strait of Hormuz. This news further dampened market hopes that shipping traffic in this vital energy route would recover quickly.
Brent oil rose to around US$72–73 per barrel, while WTI moved closer to US$69 per barrel.
According to an Axios report citing US officials, Iran reportedly fired at least two missiles at commercial vessels passing through the Strait of Hormuz on Monday night. Two vessels reportedly sustained significant damage, but there were no casualties.
Separately, UK Maritime Trade Operations also received reports that a tanker traveling south near the coast of Oman was hit by an unidentified projectile. The incident sparked a fire on board, although there were no reports of casualties or environmental damage.
This attack has re-emerged market concerns about the security of the Strait of Hormuz, one of the most important routes for global oil trade. Previously, oil prices had been pressured by the prospect of oversupply after Saudi Arabia cut its selling prices to Asia and OPEC+ signaled a production increase.
For the market, oil sentiment is currently caught between two major pressures. From the supply side, the market remains clouded by the potential for oversupply. However, from a geopolitical perspective, the risk of disruptions in Hormuz could push oil prices up in the short term. If tensions persist, Brent could potentially test the US$73–75 per barrel area, while WTI could return to near the US$70 area.
Source: Newsmaker.id