Oil Up 3% as Iran Wants U.S., Israel Ships Off Hormuz


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Crude and refined product futures rose 3% or more 
Thursday (8/6) on media reports that U.S. and Israeli commercial ships will 
likely be blocked from using the Strait of Hormuz under an emerging Iran-Oman 
plan for control of the waterway.

   Vessels tied to countries or individuals that had caused Tehran harm will 
also be restricted from the Strait unless Iran is compensated, the reports 
said, adding that offenders might have to pay up to 20% of cargo value in order 
to pass.

   The reports raised tensions across the Middle East, driving oil prices 
higher.

   NYMEX WTI crude for September delivery settled up $2.07, or 2.75%, at $77.29 
bbl. ICE Brent crude for October closed up $3.04, or 3.8%, at $82.49 bbl.

   Among refined products, NYMEX ULSD for September delivery advanced $0.0858, 
or 2.26%, to finish at $3.8820 gallon. September RBOB climbed $0.0997, or 
3.51%, to $2.9385 gallon.

   The U.S. dollar index rose by 0.284 points to 99.83 against a basket of 
currencies.

   Iran's plans for the Hormuz were unveiled days after U.S. Treasury Secretary 
Scott Bessent and President Donald Trump said a deal to unlock the waterway 
could be announced before the end of this week.

   The official U.S. position is that any route on the Hormuz must operate 
without impediments and charges as it is an international waterway, where no 
single party controlled lanes or transit rights. Iran has identified a passage 
north of the Hormuz as the only legitimate path on the Strait and warned that 
ships risk attacks if they strayed to other parts of the waterway.

   U.S. Central Command maintains that the southern route on the Hormuz through 
Omani territorial waters remains free and open for commercial traffic. But the 
U.K. Maritime Trade Operations Centre reported new explosions near commercial 
tankers off the coasts of Yemen and Oman that straddles the southern route.

   Media reports also said Tehran has threatened to strike Gulf states hard if 
they could not convince the United States to end its war against Tehran. 
Diplomatic efforts have been slow since fighting ceased two weeks ago, with 
sporadic hostilities suggesting no end soon to the near seven-month long war.

    

    




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