Crude oil prices climbed past $110 a barrel as traders brushed aside reports of steady regional supply, focusing instead on volatile shipping conditions and dwindling U.S. inventories. The market remains caught between conflicting data regarding export volumes and the persistent, high-stakes threat of regional conflict disrupting critical maritime corridors.
Brent crude reached $110.30 per barrel today, while West Texas Intermediate climbed to $99.12, each posting gains of over 1% since Tuesday. This upward pressure persists despite data from Kpler suggesting that daily oil flows from the Middle East recently exceeded pre-war levels, hitting 24 million barrels. Discrepancies in regional flow estimates—specifically regarding the Strait of Hormuz—have done little to calm investor nerves.
DBS analyst Suvro Sarkar attributed the volatility to a combination of profit-taking and fading optimism over potential diplomatic breakthroughs in Qatar or Pakistan. The market continues to react sharply to American Petroleum Institute reports showing consistent drawdowns in U.S. crude and product inventories.
Logistical hurdles are further inflating costs. Freight rates in the Persian Gulf have hit record highs, driven by the inefficient use of tankers. ING commodity strategists noted that vessels are increasingly turning to ship-to-ship transfers in the Gulf of Oman to bypass the risks of drone and missile strikes within the Strait of Hormuz, adding a significant risk premium to global energy markets.
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