-- Oil prices edged higher early even as U.S. President Trump again declared the war on Iran is near an end as traders continue to scramble for supply with the closure of the Strait of Hormuz keeping a fifth of daily supply off the market.
West Texas Intermediate crude oil for May delivery was last seen up US$0.88 to US$92.16 per barrel, while June Brent oil was up US$0.81 to US$95.58.
The rise comes despite Trump's comments to a U.S. television network that the war was "close to over", according to the New York Times, while on Tuesday saying he expected negotiations with Iran to soon continue.
Still, the Strait of Hormuz remains closed to most shipping, keeping 20% of daily oil demand from the market, as Iran continues to forbid tankers from transiting the waterway while the United States blockades Iranian ports.
"Iran's own blockade of non-Iranian oil keeps most crude inside the Gulf, while the US blockade now prevents Iranian crude from getting out. i.e., the (Strait of Hormuz) is theoretically closed from both sides (with some ships sailing through). The only meaningful ME (Middle Eastern) oil reaching the global market is Saudi Arabia's pipeline exports through Yanbu to the Red Sea," Ole Hvalbye, a commodities analyst at SEB Research, wrote.
Despite the supply shock, U.S. inventories continue to rise, limiting oil's rise. In its weekly survey released Tuesday, the American Petroleum Institute said U.S. oil stocks rose by 6.1-million barrels last week, while the consensus estimate expected a drop of 1.3-milllion barrels, according to Investing.com. The Energy Information Adminstration will release official inventory data later on Wednesday morning.