Hormuz vessel crossings fall further as security concerns linger

Oil prices rose to near six-week highs today on mounting concerns about disruptions to key Middle Eastern supply routes because of escalating hostilities between the US and Iran and threats to shipping by the Iran-backed Houthi militia in Yemen. Brent crude futures rose $2.

84, or 3.12%, to $93.85 a barrel this morning, while US West Texas Intermediate crude climbed $2.93, or 3.47%, to $87.27. Both benchmarks touched their highest levels since June 11. The US military said that it carried out an 11th consecutive night of attacks.

The US attacks came a short while after the Kuwaiti army said its air defences were intercepting Iranian drones today. The renewed conflict over control of the Strait of Hormuz is occurring amid increasing fears of further disruptions to global energy supplies after the Iran-aligned Houthis opened a new front in the war by threatening to target vessels carrying Saudi oil in the Bab el-Mandeb strait and announcing a naval blockade of Saudi Arabia.

"The energy market now has the dual-strait worry, with the Bab el-Mandeb Strait looking like it could join the Strait of Hormuz as a hot spot, as traders closely watch shipping numbers in the Red Sea," said Tim Waterer, chief market analyst at KCM Trade.

The Bab el-Mandeb at the southern entrance to the Red Sea has become an increasingly important route for Saudi Arabian crude exports as traffic through the Strait of Hormuz has fallen sharply since a ceasefire between the United States and Iran collapsed earlier this month.

Three oil tankers loaded with Saudi crude for China and India made U-turns in the Red Sea yesterday, heading towards the Suez Canal rather than braving the Yemeni coast following a warning from the Houthis. "The (Houthi) threat has led tankers to divert which could further pressure the physical market and Saudi exports, contributing to push prices to the upside," said Frank Walbaum, market analyst at trading platform Naga.

com. In response to the Houthi warnings, Asian refiners are seeking to ship crude oil from Saudi Arabia's Red Sea port of Yanbu through the Suez Canal and around Africa. While global oil stockpiles have drawn amid the conflict, the latest US data is showing some building of inventories.

Data from the American Petroleum Institute showed that US crude and distillate inventories rose last week, while gasoline stockpiles fell, market sources said. The inventory data comes ahead of official figures from the US Energy Information Administration later today.

Equinor reported adjusted profits of $11.5 billion for the three months ending June, nearly double the prior-year amount. The results were driven by higher oil and gas prices and increased production volumes during a period of elevated Brent crude prices, which ranged from about $75 to over $100 per barrel.

Company statements attributed the gains to market conditions following reduced shipments through the Strait of Hormuz and subsequent shifts in global supply.

Oil prices rose about 4% on Wednesday, with Brent crude futures at $94.23 and West Texas Intermediate at $87.46. U.S. Central Command carried out its eleventh consecutive night of strikes on Iranian military sites, including operations centers and logistics infrastructure.

U.S. Secretary of State Marco Rubio said at an ASEAN meeting that the Strait of Hormuz remained a disputed issue, accusing Iran of not engaging seriously in talks.

Shipping data showed reduced traffic through the Strait of Hormuz, with three commodity vessels observed on Tuesday—the lowest daily count since early May—and none early Wednesday. In the Red Sea, at least one vessel reversed course northward and others paused, per maritime tracking reports, following statements by Houthi forces in Yemen about potential restrictions on vessels calling at Saudi ports.

These movements took place during continued US-Iran exchanges of strikes.