Oil holds gains as Trump vows to continue Strait of Hormuz blockade

Oil saw its second weekly rise after US President Donald Trump declared he would continue the naval blockade of Iranian ports. This comes amid worries that the crucial Strait of Hormuz would not reopen anytime soon.West Texas Intermediate was close to $105, up 12% this week, while Brent for July surpassed $111 a barrel. Iran’s supreme leader, Mojtaba Khamenei, expressed scepticism about the possibility of a deal with the United States in a written statement, promising to hold onto the Islamic Republic’s nuclear and missile technologies and indicating Tehran would maintain control of the strait.

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As the impasse in discussions prolongs the near-complete shutdown of the vital canal, which prior to the war transported about a fifth of the world’s crude, oil prices have increased by more than 25% over the last two weeks. Sharp price fluctuations and a flattening of the futures curve have been caused by the uncertainty surrounding future supply.As tangible domestic tightness starts to emerge for the first time since the start of the war, the difference between paper and physical prices is closing. Last week, US oil exports reached a record as customers from around the world turned to US producers for barrels to make up for the Middle East’s lost supplies.