Oil prices were little changed on Wednesday, remaining close to two-month lows as investors weighed hopes of a diplomatic breakthrough in the US-Israeli war with Iran against continuing threats to commercial shipping in the Strait of Hormuz.
Brent crude futures rose 19 cents, or 0.2%, to $91.68 a barrel by 9:11 GMT. US West Texas Intermediate (WTI) fell 6 cents, or 0.1%, to $85.98.
Shipping attacks remain a major concern for energy markets. Thirty-seven vessels were targeted in October, the highest monthly total since the conflict began, according to data from the Washington Institute for Near East Policy.
“There has been an increase of vessel attacks in the Gulf shipping lanes amidst uncertainty of the diplomacy talks,” said June Goh, senior analyst at Sparta Commodities.
She said oil prices were facing downward pressure as expectations of increased crude flows from the Middle East improved, adding that the market’s direction would depend largely on whether Iran accepted US demands for a diplomatic agreement.
The latest incidents have raised questions about the safety of vessels travelling through the strategic waterway. The United Kingdom Maritime Trade Operations agency reported on Tuesday that a tanker had been struck northeast of Lima in Oman.
Separately, Iran’s Revolutionary Guards Navy said two tankers caught fire after hitting naval mines while using what it described as an unauthorised route through the strait.
Even if an agreement is reached, restoring normal shipping activity could take time. LSEG Oil Research said in a note dated November 10 that increased traffic would depend on mine clearance, insurance costs and whether shipping companies were willing to resume operations amid continuing security risks.
Oil prices had fallen by more than $3 a barrel during the previous session after US officials played down the prospect of further military strikes against Iran. However, the decline was partly reversed after an Iranian security official said no negotiations were taking place between the two countries.
Supply figures also influenced market sentiment. US crude inventories increased by 9 million barrels in the latest week, according to data from the American Petroleum Institute cited by market sources. Official figures from the US Energy Information Administration were due later on Wednesday.
Elsewhere, a drone attack caused a fire in the port area of Ust-Luga on Russia’s Baltic coast, injuring three workers, a regional governor said. Industry sources said renewed Ukrainian drone attacks had reduced Russian oil refining capacity by around 30% since late October.
Russian and Ukrainian officials met in Abu Dhabi on Tuesday for their first peace talks since February, as representatives of US President Donald Trump renewed efforts to end the war.
Developments in the negotiations, alongside the security situation in the Gulf and changes in oil supply, are expected to remain key influences on crude prices.
