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Update: WTI Oil Rises Again as Fighting Between US and Iran Keeps Tankers Trapped in Persian Gulf

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(Updates prices in the second paragraph.)

West Texas Intermediate (WTI) crude oil rose on Tuesday, climbing for a third straight session as fighting between Iran and the United States continues to constrain Persian Gulf supply.

WTI crude oil for August delivery closed up $1.68, or 2%, to settle at $84.91 per barrel, while September Brent was last seen up $1.70, or 1.9%, to $90.92.

The rise comes as fighting continues to block shipping in the Strait of Hormuz, the chokepoint for a fifth of daily oil demand supplied by countries in the region prior to the start of the war. The UK Maritime Trade Operations agency reported an attack on a vessel moving through the strait on Monday, forcing the crew to abandon ship.

The renewed fighting has pushed oil up by 13% over the past month, as buyers hunt for supply and tankers wait to move through the strait. Hormuzstraitmonitor.com reported that just 13 ships moved through in the last day, with 142 tankers still waiting to move out of the region.

A fresh threat to the market came on Monday, after Yemen's Houthi militant group threatened to close the Bab al-Mandab Strait at the southern end of the Red Sea, blocking Saudi Arabia's exports through the sea, pushing prices higher.

Still, a Reuters report that mediators are proposing a 10-day ceasefire to renew negotiations between Iran and the US raised hopes the two sides may reach an agreement to end fighting.

"The move (higher) came from the Houthi maritime blockade on Saudi Arabia, a tenth consecutive day of US strikes on Iran and a tanker strike in the Strait of Hormuz. Crude gave some of that back overnight, with Brent easing 0.7% to around USD 88.55 as reports of a possible 10-day pause in strikes circulated," Saxo Bank wrote in a note.

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