Brent rebounds as attacks on vessels continue

The front-month ICE Brent contract has increased by $0.96/bbl on the day, to trade at $91.55/bbl at 09.00 GMT.

IMAGE: Getty Images

Upward pressure:

Brent futures have rebounded, following a report of a fresh attack on a tanker near the Strait of Hormuz. The United Kingdom Maritime Trade Operations (UKMTO) agency reported on Tuesday that a vessel was struck by an unknown projectile, approximately 19 nautical miles (NM) northeast of Lima, Oman.

The agency has advised vessels to transit with caution.

Iran's Revolutionary Guards Navy said, on Tuesday, that two tankers caught fire after striking naval mines while transiting the Strait of Hormuz, Reuters reported.

Additionally, Iran has denied US claims that negotiations on reopening the Strait of Hormuz are continuing. Iran’s Security Council chief Mohsen Rezaei said, “The US' claim about continuing negotiations or holding a meeting in Qatar is a pure lie,” state-owned news agency IRNA reported.

Downward pressure:

US crude oil inventories increased by 9 million bbls in the week ending 6 November, according to estimates from the American Petroleum Institute (API), as cited by Trading Economics.

A rise in US crude stocks usually indicates lower demand and can put downward pressure on Brent’s price. The market is now awaiting official inventory data from the US Energy Information Administration (EIA), which is due to be released later today.

Senior officials from Russia and Ukraine met in Abu Dhabi on Tuesday for US-brokered peace talks, marking their first such meeting since February, Reuters reported.

By Shilpa Sharma

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