Khaberni - Oil prices rose by more than 1% on Tuesday, making up for some of the losses of the previous session, amid renewed fears about the war in Iran, and the continuing closure of the Strait of Hormuz to a large extent.
According to Reuters, Brent crude futures climbed $1.73, or 1.7%, to $101.94 a barrel, while West Texas Intermediate crude increased by $1.23, or 1.3%, to $94.73.
In the previous session, Brent crude futures fell by 2.8% at settlement, while West Texas Intermediate crude declined by 5.3%, after some ships temporarily crossed the strait.
The US-Israeli war on Iran entered its third week with no signs of a resolution, while the Strait of Hormuz, through which 20% of the world's oil and liquefied natural gas trade passes, saw a significant halt due to the war, raising concerns of supply shortages and rising energy costs and inflation.
Market analyst at IG, Tony Sicamore, noted in a memo: "The risks remain large: it would be enough for an Iranian armed group to launch a missile or plant a mine on a tanker to ignite the situation again."
Many allies of the United States refused President Donald Trump's call on Monday to send warships to accompany ships through the strait, sparking his criticism, accusing Western partners of "ingratitude after decades of support."
White House economic advisor Kevin Hassett told CNBC in an interview that oil tankers are crossing the Strait of Hormuz, stressing the need to end the war within weeks, not months.
Cavendish Investment Bank noted in a memo that "despite eased concerns about an immediate impact due to supply stoppages, traders still expect the disruption to be severe."
OANDA analyst Kelvin Wong mentioned that oil prices still have the potential to rise by the end of March, as technical analysis shows that the medium-term resistance for West Texas Intermediate crude is $124 per barrel.
To alleviate rising energy costs, the head of the International Energy Agency proposed that member countries withdraw more oil, in addition to the 400 million barrels they had agreed to withdraw from strategic reserves.
