Crude futures climbed in after-hours trading on Thursday as markets remained cautious on the outcome of Iran-Oman talks, which could restore flows via the Strait of Hormuz, while Houthi attacks on Saudi tankers in the Red Sea and Gulf of Aden stoked supply disruption fears.
Brent crude futures rose 3.9% to $82.52 per barrel, while Murban crude futures advanced by 2.5% to $79.91/bbl.
Iran and Oman agreed to establish a shipping corridor through the Hormuz, a step towards reopening the strategic waterway that raised expectations of higher Middle East energy exports.
Iran and Oman on Wednesday reached an understanding on the geographic coordinates for a shipping route through the Hormuz, and a joint announcement is being finalized.
The two countries that border the key energy chokepoint have been negotiating a plan to manage maritime traffic through the strait since last month.
Iran's Foreign Ministry spokesman Esmaeil Baghaei said talks between Iran and Oman had been underway for the past two months to establish a safe passage mechanism for commercial vessels transiting the strategic waterway.
Gelber & Associates said that uncertainty surrounding the Iran-Oman negotiations is also preserving some geopolitical risk premium, although progress toward reopening the Strait of Hormuz is limiting the advance.
On Wednesday, Yemen's Houthi rebels attacked a Saudi oil tanker in the northern Red Sea off the coast of Yanbu.
Houthi spokesperson Yahya Saree said that the Iran-aligned militant group plans to expand operations into the northern Red Sea after alleging that Saudi tankers had begun rerouting away from the Bab el-Mandeb Strait.
The Houthis also reportedly launched attacks in central and eastern Yemen on Thursday, resulting in the death and injury of "hundreds" of the internationally recognized government troops.
Fueling bullish sentiment, Iran reportedly warned Gulf states that any new US attack on its territory would trigger retaliation against critical energy infrastructure across the region.
The warning was delivered through a flurry of high-level diplomatic contacts after President Trump threatened on July 28 to strike Iran's energy network and infrastructure, according to media reports.
Meanwhile, Trump repeated on Wednesday that a deal regarding the strait is imminent and that his administration is in contact with Iran.
ING strategists said that the real hinge point is the trajectory of US-Iran discussions, because meaningful progress there is essential before disrupted energy flows can realistically resume.
On the supply front, US commercial crude oil inventories increased by 2.5 million barrels to 407 mmbbls in the week ended July 31, the Energy Information Administration said in its weekly report on Wednesday. Crude inventories were about 6% below the five-year average for this time of year, the EIA said.