Oil prices edged lower on Tuesday as investors assessed the risk of potential supply disruptions following fresh U.S. guidance to vessels transiting the Strait of Hormuz, keeping market focus on rising tensions between Washington and Tehran.
Brent crude futures fell 18 cents, or 0.26 per cent, to $68.85 a barrel by 0353 GMT, while U.S. West Texas Intermediate (WTI) crude slipped 21 cents, or 0.33 per cent, to $64.15 a barrel.
The modest pullback followed gains of more than 1 per cent on Monday, triggered by a notice from the U.S. Department of Transportation’s Maritime Administration. The agency advised U.S.-flagged commercial vessels to remain as far away from Iran’s territorial waters as possible and to verbally decline any request by Iranian forces to board their ships.
The Strait of Hormuz remains a critical chokepoint for global energy markets, with about one-fifth of the world’s oil consumption passing through the narrow waterway between Oman and Iran. Any escalation in tensions in the area poses a significant threat to global oil supply.
Several major oil producers, including Iran and fellow OPEC members Saudi Arabia, the United Arab Emirates, Kuwait, and Iraq, export the bulk of their crude through the strait, primarily to Asian markets.
The U.S. guidance was issued despite Iran’s top diplomat stating last week that Oman-mediated nuclear talks with Washington had gotten off to a “good start” and were expected to continue.
Analysts said oil prices remain sensitive to geopolitical developments in the Middle East, with traders closely monitoring diplomatic signals alongside shipping security risks in one of the world’s most strategic energy corridors.
