Crude oil futures were little changed in midday trading on Thursday as fresh US strikes on Iranian military installations deepened concerns over potential supply disruptions in the Middle East.
Front-month West Texas Intermediate crude futures eased 0.7% to $79.05 per barrel, while Brent futures slipped 0.6% to $84.40/bbl.
Soojin Kim, research analyst at MUFG, said crude prices steadied after gaining about 12% over the previous three sessions as renewed US strikes on Iran and repeated attacks on shipping revived concerns over Gulf supply.
US commercial crude oil inventories decreased by 1.7 million barrels to 409.7 mmbbls in the week ended July 10, the Energy Information Administration said in its weekly report on Wednesday, less than Investing.com's forecast of a 1.8-mmbbl draw.
Crude inventories are now about 6% below the five-year average for this time of year, the agency said.
On Wednesday, the US hit an unladen oil tanker attempting to sail toward Iran's main export terminal, as shipping traffic via the Strait of Hormuz has slumped. The latest data from Kpler show that confirmed crude and condensate transit through the strategic waterway fell 62% to 4.1 million barrels per day.
US Central Command also said on Wednesday it carried out a fresh wave of attacks on Iran overnight that concluded at 9 p.m. ET, hitting Iranian coastal defenses and missile sites after reimposing a naval blockade of the country's ports.
"US forces struck Iranian command centers, air defense sites, missile and drone capabilities, and coastal surveillance facilities to further degrade Iran's ability to threaten innocent mariners crewing commercial vessels transiting the Strait of Hormuz," Centcom said in a statement posted on X.
Meanwhile, Iran warned that it would "crush" key targets in the Middle East if President Trump's threats to target the country's infrastructure in the coming days are carried out.
Ebrahim Zolfaqari, spokesperson for Iran's military command, said infrastructure in the Gulf region that has remained untouched so far would be "smashed under the iron blows" of Iran's armed forces if the US carries out attacks on Iranian infrastructure.
Iran also asked Yemen's Houthi rebels to stand ready to close the Red Sea oil route if the US strikes Iranian power infrastructure, according to media reports, which would further threaten global energy supplies.
RBC Capital Markets strategists said a potential new front in the Red Sea is compounding geopolitical tensions.
Saudi Arabia has increased crude exports via its East-West Pipeline and the Yanbu terminal to about 4 million b/d to offset reduced flows through the Strait of Hormuz, making the Red Sea a critical alternative export route.
The consultancy said any renewed Houthi attacks on shipping or Saudi energy infrastructure could threaten that capacity and significantly worsen supply risks.