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EMEA Oil Update: Crude Extends Rally Amid Middle East Geopolitical Gridlock

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Crude oil futures advanced on Tuesday, as stalled negotiations over the Strait of Hormuz and persistent Middle East supply risks fueled market gains.

Brent futures rose 1.7% to $89.18 per barrel, while Murban closed at $84.90/bbl on Aug. 10 and was not trading by the time of publication of this oil price update. Both contracts gained more than 5% on Monday.

ANZ analysts said "Oil rallied as a deal to reopen the Strait of Hormuz remains elusive."

While Iran reportedly indicated it was close to reaching an arrangement with Oman, Tehran reiterated that any agreement requires the US to lift its blockade on Iranian ports and demanded compensation for damages from US military strikes.

President Donald Trump rejected these demands during a White House executive order signing, asserting instead that Iran should pay for regional damages and casualties, and signaling a preference to let economic pressures build rather than launch new military strikes while maintaining that the US Navy holds complete control of the strait.

Supply-side pressures and tighter refined product markets further supported the upward price action.

Kpler raised its 12-month North Sea Dated Brent forecast to $81 per barrel from $73 per barrel, citing tightening global balances from Middle East disruptions, though noting that weak Chinese demand continues to cap further upside.

Meanwhile, shipping data showed that commercial vessel traffic through the Strait of Hormuz dropped over the weekend amid continued security risks, whereas the Bab el-Mandeb Strait remained significantly busier.

EBW Analytics Group strategists highlighted that crude prices are poised for a moderate near-term rebound as markets weigh these acute supply and chokepoint uncertainties against broader long-term fundamentals.

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Trump Demands Iran Pay Damages, Says US Controls Strait of Hormuz

US President Donald Trump said Monday Iran should pay damages for past attacks and deaths, while reiterating the US Navy maintains 100% control of the Strait of Hormuz.Trump made the remarks while signing an executive order at the White House."We're going to ask for money for the damage they've done over a 50-year period...," Trump said, citing past attacks and victims, including the USS Cole and people who were hurt, wounded or killed.He said the US could also seek compensation for protesters killed in Iran, adding that families should receive damages for the deaths of their relatives. "... maybe damages for the 52,000 protesters over the last four months that were killed in Iran," Trump said.Trump said the US Navy now controls the Strait of Hormuz and allows selected vessels to pass through the waterway, while blocking ships from entering Iran."The only one that has control of the Strait of Hormuz right now is the United States Navy. We have a blockade that's been infallible," Trump said, describing the US blockade as "a steel wall."Trump said US forces have swept mines from the Strait of Hormuz, "... we've mine swept the entire Strait, ... we control the Strait 100%," he said.Asked whether a massive escalation against Iran remained on the table, Trump said the US retains the ability to take such action. "We have that... ability if we want to do that... you'll find out," he said.

Oil & Energy

US Oil Update: Crude Surges as Iran-US Compensation Demands Raise Hormuz Uncertainty

Crude futures rallied in after-hours trading on Monday as renewed demands between Iran and the US for compensation for damages from the five-month conflict dimmed prospects for an imminent reopening of the Strait of Hormuz.Front-month West Texas Intermediate crude futures climbed by 5.3% to $82.30 per barrel, while Brent futures advanced by 5.2% to $87.61/bbl.Gelber & Associates said that Iran has tied renewed commercial passage to broad demands including sanctions relief and compensation, signaling that negotiations mediated by Oman remain far from a resolution.President Trump said on Monday that he will demand compensation from Iran for Americans killed and wounded in regional conflicts, as Iran seeks financial restitution for damages incurred during the recent five-month military conflict.Trump said that Iranian officials had raised the issue of compensation for war damages, even though he claimed the topic had not appeared in previous diplomatic meetings.In a separate post published shortly after, Trump blamed Iran for damages and deaths across the region. "Also, with respect to the Iran negotiations, Iran should be responsible for the damages and death caused to the people of Lebanon, Syria, Yemen, and Gaza," Trump posted.On Monday, Iran's Foreign Ministry spokesman, Esmaeil Baqaei, said that the US must lift its blockade before Tehran would agree to fully open Hormuz.Baqaei said that as long as the US naval blockade of Iranian ports continues, the necessary conditions for the reopening of the strategic waterway do not exist.The opening of the Strait of Hormuz is contingent on the realization of Iran's conditions, Baqaei said, adding that the US has no moral or legal standing to complain about the Strait of Hormuz not being open.ING strategists said that while President Trump said Washington is "semi-negotiating" with Iran, suggesting a focus on economic pressure rather than military escalation, significant hurdles remain before any broader agreement is reached.Fueling bullish sentiment, strikes across the region and in the Hormuz have also kept the market on edge. On Saturday, the UAE condemned an Iranian attack on a carrier linked to the country's state energy giant Adnoc while transiting the Hormuz.On Sunday, Yemen's Houthis attacked Saudi Arabia's Jazan refinery, further adding strain to an already tight global diesel market, as disruptions to shipments through Hormuz deepen the impact of Russia's fuel export ban.Saxo Bank strategists said that the risk of renewed Middle East escalation remains elevated, but the muted price response highlights competing headwinds from weak Chinese demand and the release of emergency reserves.Traffic through the Middle East energy chokepoints diverged over the weekend, with MarineTraffic data showing 32 confirmed crossings in the Hormuz between Aug. 7 and 9, while crossings via Bab el-Mandeb held steady at 116 confirmed crossings over the same period.

Oil & Energy

Shipping Traffic via Hormuz Falls as Security Risks Persist

Commercial vessel traffic via the Strait of Hormuz fell over the weekend as shipping faced continued security risks and heightened scrutiny from Iranian forces, while the Bab el-Mandeb Strait remained considerably busier, shipping data showed on Monday."Since last Monday, traffic continued through both chokepoints, but the operating environment remained fragile," MarineTraffic said in a Monday note, noting that verified transits through the Strait of Hormuz totaled 84 from Aug. 3-9.Traffic through the Hormuz fell to six on Sunday, down from 11 on Saturday and 15 on Friday, MarineTraffic data showed.A total of 32 vessels were recorded transiting the strait between Friday and Sunday. "The latest daily count was therefore the lowest of the week and was strongly weighted toward vessels entering the Middle East Gulf," according to MarineTraffic.The data platform said routing remained concentrated, with 17 movements using Iran's Unilateral Scheme and 10 classified as route undetermined, highlighting the uncertainty surrounding vessels' movements.Across the week, a total of 44 crossings used the Iranian Unilateral Scheme, while 35 were Route Undetermined, four used the International Maritime Organization's Hormuz Traffic Separator Scheme and one used Omani Territorial Waters Passage.The slowdown comes as the UK Maritime Trade Operations agency warned of continued risks to commercial shipping in and around the Strait in its Sunday note.Iran's Islamic Revolutionary Guard Corps continued to hail and surveil merchant vessels, including through unmanned aerial vehicle overflights, while projectile strikes and near-miss explosions were reported along the southern Omani approaches near Limah, Khasab and Kumzar.The UKMTO said risks also include the possibility of drifting or uncharted mines, with mine danger areas remaining active near the traffic separation scheme.The US Central Command said that as of Aug. 9 it had redirected 55 commercial vessels, disabled two and boarded two others to ensure compliance.Meanwhile, traffic via the Bab el-Mandeb held steady over the same Aug. 7-9 period, with 116 confirmed crossings, according to MarineTraffic. Daily crossings stood at 43 on Friday, 37 on Saturday and 36 on Sunday.However, MarineTraffic said that the Red Sea route remained below levels seen before the Houthi-declared blockade on July 20. The data also showed continued AIS visibility concerns, with 12 dark transits recorded during the period."Saturday also recorded elevated risk activity, including 10 sanctioned crossings and eight dark transits," according to MarineTraffic.The divergent traffic patterns illustrate how risk perceptions are shaping shipping routes. Though vessels continue to move via the Bab el-Mandeb in relatively greater numbers, the decline in Hormuz crossings suggests shipowners and operators remain cautious about transiting the strategic waterway.