Oil prices increased by more than $3 on Wednesday on fresh attacks on at least three container ships in the Strait of Hormuz amid a lack of progress in peace talks between the US and Iran.
Brent crude futures gained $3.43 or 3.48 per cent to trade at $101.91 a barrel, while the US West Texas Intermediate (WTI) crude futures appreciated by $3.29 or 3.67 per cent to $92.96 per barrel.
At least three container ships were hit by gunfire in the Strait of Hormuz on Wednesday.
Iran’s Revolutionary Guards Navy (IGRC) seized two vessels for what it described as maritime violations and transferred them to Iranian shores. The two ships – the Panama-flagged MSC Francesca and Liberia-flagged Epaminondas – were seized for “attempting to exit the Strait of Hormuz covertly”.
Iran and the US have imposed restrictions on ships using the strait, which carried about 20 per cent of global oil and liquefied natural gas supplies until the war began at the end of February. The standoff over the strait has raised doubts about whether stalled peace negotiations will resume.
The seizures mark the first time Iran has taken control of ships since the beginning of the war, which started on February 28, and come after the US fired on and seized an Iranian cargo vessel and boarded an Iranian oil tanker in the Indian Ocean.
In the latest in a series of about-turns, President Donald Trump threatened violence on Tuesday, hours before announcing he was unilaterally extending a ceasefire.
Previously, the American President Trump said he would indefinitely extend the ceasefire with Iran, hours before it was due to expire. Neither side showed up for peace talks in Pakistan.
Countries in Asia that are dependent on Gulf oil have been badly hit, with shortages of fuel, fertiliser and other raw materials that pass through the strait. While the West is better insulated, it is not immune, with Germany, Europe’s largest economy, slashing its 2026 growth forecast to 0.5 per cent on Wednesday, while Greece announced €500 million in extra aid for households and farmers.
Crude oil inventories in the US increased by 1.9 million barrels during the week ending April 17, according to new data from the U.S Energy Information Administration (EIA) released on Wednesday. The increase brings commercial stockpiles to 465.7 million barrels according to government data.
The EIA’s data release follows figures by the American Petroleum Institute (API) that were released on Tuesday, which reported that crude oil inventories saw a draw of 4.4 million barrels in the period.