SINGAPORE — Oil prices held broadly steady on Thursday as investors weighed conflicting signals over negotiations that could eventually reopen the Strait of Hormuz, with market participants awaiting clearer evidence of progress before reassessing global supply expectations.
Brent crude futures traded near $80 a barrel while U.S. West Texas Intermediate crude hovered in the mid-$70 range during Asian trading, with modest gains reflecting continued caution over developments in the Middle East rather than a decisive shift in market sentiment.
The market has been closely focused on diplomatic contacts involving Iran and Oman after reports that discussions had produced an understanding related to navigation through the strategic waterway. However, officials have not announced a final agreement to restore normal commercial shipping, leaving traders reluctant to price in a sustained increase in oil supplies.
The Strait of Hormuz is one of the world's most important energy transit routes, carrying a significant share of globally traded crude oil and liquefied natural gas. Disruptions to shipping through the passage have driven heightened volatility in energy markets in recent months as conflict and security concerns affected tanker movements.
Analysts said expectations of an eventual reopening have reduced some of the geopolitical risk premium that had supported crude prices earlier in the regional conflict. At the same time, uncertainty over the timing and scope of any agreement has prevented a sharper decline in prices.
Investors also continued to monitor security risks after reports of attacks targeting vessels linked to regional energy trade, developments that underscored the possibility that shipping disruptions could persist even if diplomatic negotiations advance. Reuters could not independently verify all reported incidents, and Saudi authorities had not publicly confirmed the reported attacks.
Beyond geopolitical developments, traders assessed supply-and-demand indicators, including U.S. government data showing a modest increase in crude inventories amid lower refinery activity and higher imports, adding another factor limiting upward momentum in prices.
Financial markets have also been evaluating the broader economic implications of any restoration of shipping through Hormuz. A sustained reopening could ease concerns about global energy supplies and transportation costs, though analysts cautioned that physical flows and insurance conditions would need to normalize before the market could conclude that the disruption had ended.
As of Thursday, officials had not announced a comprehensive agreement guaranteeing the full reopening of the Strait of Hormuz, leaving oil markets focused on further diplomatic developments and confirmation of any changes in commercial shipping activity.
