Oil extends gains, Brent surpasses $98

Oil drilling rigs

Oil prices extended their gains today, July 23, with Brent crude surpassing $98 a barrel. Concerns grew about crude supplies from the Middle East as attacks on ships in the Strait of Hormuz continued.

Iran’s Revolutionary Guard announced that an oil tanker was hit by an explosion while trying to cross a minefield in the Strait of Hormuz, while two other tankers turned back, asserting that the strait is under Iranian control, Reuters reported.

During trading today, Brent crude futures touched $96.27 a barrel—the highest level since June 8. The benchmark grade had gained more than 3% yesterday.

Analysts at HSBC said in a note on July 22 that the recent rise in oil prices reflects renewed concerns about the security of navigation in the Strait of Hormuz after the collapse of the ceasefire between Washington and Tehran. They noted that the direction of the market will depend on the ability of diplomatic efforts to restore shipping flows to normal.

*At 10:50 am Makkah time