Oil Prices Rise After Reports Of Container Ships In Hormuz Being Hit By Gunfire

Oil prices jumped on Wednesday with Brent trading above $100 a barrel, erasing earlier losses following reports of gunfire attacks on at least three container ships in the Strait of Hormuz.

Brent crude futures were up $1.59, or 1.6%, at $100.07 a barrel at 0842 GMT. West Texas Intermediate futures rose $1.51, or 1.7%, to $91.18. Both benchmark contracts rose about 3% on Tuesday.

At least three container ships were hit by gunfire in the Strait of Hormuz on Wednesday, maritime security sources and the United Kingdom Maritime Trade Operations said.

Iran has imposed restrictions on ships using the strait, first in retaliation for the U.S.-Israeli bombardment of the country, and then in response to a US blockade of Iranian ports.

Also Read: Indian Oil Tanker Desh Garima Reaches Mumbai, All 31 Crew Members Safe

Earlier, the US President Donald Trump had said he would indefinitely extend the ceasefire with Iran, hours before its expiry, to allow talks to continue to end a war that has killed thousands and shaken the global economy.

Doubts Over Whether Israel & Iran Will Agree

The announcement appeared to be unilateral, and it was not immediately clear whether Iran, or U.S. ally Israel, would agree to extend the truce, which began two weeks ago.

There was no immediate comment from Iran's most senior leaders on Trump's ceasefire extension.

The Strait of Hormuz, until the Iran war began at the end of February, was the channel for about 20% of global oil and liquefied natural gas supplies.

In Europe, Ukrainian President Volodymyr Zelenskiy said the Druzhba oil pipeline pumping Russian oil is ready to resume operation. Three industry sources, however, said Russia is set to stop oil exports from Kazakhstan to Germany via the Druzhba pipeline starting on May 1.

Later on Wednesday, the U.S. Energy Information Administration will publish inventory data. Crude oil inventory fell by 4.5 million barrels last week, while gasoline and distillate stocks also declined, market sources said, citing American Petroleum Institute figures. Analysts estimated a 1.2-million-barrel draw of crude for the week ended April 17.

"If the EIA confirms the draws and U.S. weekly exports of both crude oil and refined products remain robust, this will be taken as confirmation that consumers in Europe and the Far East are scrambling to secure oil supplies wherever, whenever, and however they can," PVM analysts said.