Brent crude futures were up 48 cents, or 0.7%, trading at $70.63 a barrel as of 08:55 GMT. U.S. West Texas Intermediate (WTI) crude gained 51 cents, or 0.8%, reaching $68.84 a barrel. Both benchmarks remained at their highest levels since June 23.
The rally comes in the wake of renewed attacks on vessels transiting the Red Sea—a critical global shipping route. After months of relative calm, hostilities resumed last week, with sources attributing the assaults to Yemen’s Iran-aligned Houthi militia. A cargo ship struck in the region sank, killing at least four crew members. Efforts to rescue survivors were underway Wednesday, though the Houthis have not claimed responsibility for the incident.
Adding to upward pressure on oil prices was a revised forecast from the U.S. Energy Information Administration (EIA), which on Tuesday projected lower domestic oil output for 2025 than previously anticipated. The adjustment reflects slowing activity among producers in response to weakening crude prices.
Meanwhile, former President Donald Trump announced plans to impose a 50% tariff on copper—a key component in electric vehicles, military equipment, power infrastructure, and consumer electronics—in a bid to spur domestic production. The move, announced alongside a delay on other tariff decisions until August 1, has injected fresh uncertainty into global trade dynamics, even as it offers a potential window for negotiation.
While there are concerns that higher tariffs could weigh on energy demand, short-term factors are currently outweighing those fears. The U.S. July 4 holiday weekend saw robust travel activity, and preliminary data from the American Petroleum Institute suggested a crude inventory build of roughly 7.1 million barrels.
“Given the Red Sea disruptions and stronger U.S. fuel consumption during summer travel season, expectations of ample future supply are taking a back seat to immediate concerns,” oil brokerage PVM wrote in a research note.
Market participants are now awaiting official inventory figures from the EIA, due at 14:30 GMT.
In a separate development, OPEC+ producers are preparing for a substantial output increase in September. According to five sources, this includes the phased rollback of voluntary production cuts by eight members, along with the United Arab Emirates’ transition to a higher output quota. The group had already approved a 548,000 barrels-per-day supply hike for August.
Despite the rising supply, oil prices have remained resilient. “Oil prices have stayed surprisingly firm amid accelerated OPEC+ supply additions,” said Suvro Sarkar, energy sector lead at DBS Bank.
UAE Energy Minister Suhail al-Mazrouei echoed that sentiment on Wednesday, stating that the market is absorbing the additional barrels without significant inventory build-up. “Even with increases over several months, we haven’t seen major stockpiles, which indicates strong demand,” he said.
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