uncertainty over U.S.-led Hormuz shipping coalition
Oil prices started a weekly rise starting Friday, despite the United States granting countries 30-day licenses to purchase Russian oil and oil products offshore.
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Oil prices rose more than 2 percent on Tuesday as uncertainty continued over the U.S.-led coalition’s decision to protect shipping through the Strait of Hormuz.
While the international benchmark Brent crude oil increased by 2.45% to $102.57 per barrel, US West Texas Intermediate crude oil increased by 2.51% to $95.85 per barrel.
The United States has allowed Iranian oil tankers to pass through the Strait of Hormuz, US Treasury Secretary Scott Bessent said on Monday.
The Wall Street Journal reported The United States will soon announce a coalition of countries that will escort ships across the Bosphorus, he said, citing officials.
Oil prices since the beginning of the year
But President Donald Trump said on Monday that the coalition did not fully exist and called on other countries to get involved.
Trump added that he was disappointed that some countries were reluctant to participate.
“Some are very enthusiastic, some are not so enthusiastic,” Trump told reporters at the press conference. he said. “And I assume some of them won’t do that. I think there are one or two that won’t do that that we’ve protected with tens of billions of dollars for nearly 40 years.”
The United States is calling on its allies to send military forces to protect tanker traffic in the Bosphorus. Ship movements along the vital shipping route have decreased following Iran’s attacks, fueling one of the largest disruptions to global oil supplies in history.
“The magnitude of the disruption to oil supply makes it difficult for the market to find an adequate solution,” said Warren Patterson, head of commodity strategy at ING.
“Although the US administration has put forward the idea of insurance guarantees and naval escorts, neither has been implemented yet,” Patterson said.
He added that escorting merchant ships in the Strait of Hormuz would leave navy ships vulnerable to attack, so the United States may refrain from such action until it feels Iran’s ability to attack ships has diminished.
Located between Oman and Iran, the strait serves as a vital artery for global oil trade. According to energy consulting firm Kpler, around 13 million barrels per day will pass in 2025; This represents approximately 31% of all seaborne crude oil flows.
