Above $103.00: WTI Oil stays near five-month highs amid fresh attacks in the Strait of Hormuz

$103.00 holds as a floor for WTI Oil after a fresh five-month high at $104.00.
Supply disruption fears intensify as attacks continue in the Strait of Hormuz.
Despite regional efforts to secure a peace agreement, the US retains the option of military action.

WTI remains above $103.00 a barrel. The US benchmark, West Texas Intermediate (WTI), climbed to a five-month high just above 104.00 earlier on Friday and is heading for a 15% monthly gain. Oil is advancing for a third consecutive day as reports of fresh attacks on vessels seeking to cross the Strait of Hormuz heighten fears of supply disruptions.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Continued attacks on shipping in the Strait of Hormuz are driving crude prices upwards. The UK Maritime Trade Organisation (UKMTO) reported on Friday that two limpet mines had exploded, disabling an oil tanker. It was the first successful attack using this type of explosive since the conflict began in February.

Global supply concerns also intensified after authorities from the Iranian Islamic Revolutionary Guard Corps (IRGC) stated that four vessels had struck tankers in the Hormuz waterway. Separately, Tehran-backed Houthi militias claimed attacks on airports and oil infrastructure in Saudi Arabia.

Qatari delegation returns to Tehran for renewed peace push

Efforts by regional mediators to secure an elusive peace agreement continue. Earlier on Friday, Reuters reported that a Qatari delegation had returned to Tehran to try again to bring the US and Iran back to negotiations. The visit followed alleged contact between US Vice President JD Vance and Iranian officials, in which he proposed a new diplomatic process.

With the two sides still far apart on key issues such as uranium enrichment, markets doubt that negotiations will deliver a swift end to the conflict. Meanwhile, the Wall Street Journal reported on Thursday that a senior US commander had briefed US President Donald Trump on military options in Iran. This suggests hostilities might restart after next week’s mid-term elections.

WTI Oil: Key Questions

What defines WTI Oil?

Traded internationally, WTI Oil is a crude oil grade whose initials stand for West Texas Intermediate. Alongside Brent and Dubai Crude, it is one of the three major grades. Its relatively low gravity and sulphur content earn it the descriptions “light” and “sweet”, respectively. This high-quality oil is regarded as easy to refine. Produced in the United States, it is distributed through the Cushing hub, known as “The Pipeline Crossroads of the World”. WTI serves as an oil market benchmark, with its price regularly cited by the media.

Which forces determine WTI Oil prices?

Supply and demand underpin WTI Oil prices, as they do those of other assets. Stronger global growth can lift demand, while weaker growth can have the reverse effect. Supply disruptions arising from political instability, war or sanctions can also affect prices. Another major influence is the policy of OPEC, a group of leading oil-producing countries. Since oil is traded mainly in US Dollars, the value of the US Dollar also matters: a weaker currency can make WTI Crude Oil more affordable, while a stronger one can have the opposite effect.

Why do inventory reports affect WTI Oil prices?

Changes in oil inventories signal shifts in supply and demand, making the weekly reports from the American Petroleum Institute (API) and the Energy Information Agency (EIA) influential for WTI Oil prices. Falling stocks can point to stronger demand and lift prices. Rising stocks, by contrast, can indicate greater supply and weigh on prices. The API releases its report every Tuesday, followed by the EIA the next day. The two sets of results tend to be similar: 75% of the time, they are within 1% of each other. As the EIA is a government agency, its figures are regarded as more reliable.

How do OPEC decisions affect WTI Oil prices?

At meetings held twice a year, the 12 oil-producing nations in OPEC (Organization of the Petroleum Exporting Countries) jointly set production quotas for member countries. These decisions frequently influence WTI Oil prices. Lower quotas can restrict supply and lift oil prices; increased OPEC production can have the reverse effect. The broader OPEC+ group adds ten non-OPEC members, most notably Russia.