Wright says USO falls 1.85% in pre-market trading as Hormuz standoff drags on

Wright says diesel prices have likely peaked even as USO trades down 1.85%, at $141.33 a share, in pre-market trading because the Strait of Hormuz remains a conflict zone.

Crude is holding near $100 a barrel because the Strait of Hormuz remains a conflict zone, Wright said, adding that diesel prices have likely already peaked.

The assessment lines up with weeks of contested transit data out of the strait. Iran has repeated that it will not reopen Hormuz under pressure. Tanker traffic through the waterway has fallen 80% from February levels, and UKMTO has logged seven vessel strikes near the strait since September 28, with traffic running near two vessels a day against a pre-conflict average of 125. Iran's Revolutionary Guard Corps has warned ships against using the US-backed transit route.

That contested picture followed Hassett's statement that the Navy had reopened the strait and that crude was flowing freely again. A day later, a projectile strike caused a fire and blackout on a tanker in the strait, the fourth such unknown-projectile strike UKMTO has logged since mid-September.

An oil fund slipped in pre-market trading on Tuesday as tanker traffic stayed near a standstill. USO had already fallen 2.41% to $143.82 a share on Monday after Aramco cut its Arab Light price for Asia. The LNG shortfall tied to Hormuz transit has doubled year-on-year, and global LNG spot prices have hit their highest level since late 2022 as Qatar extends its supply freeze.

Wright's remarks add little beyond what has already been reported: crude near $100 reflects the same risk premium traders have priced in through weeks of unconfirmed incidents and swinging transit figures, not any fresh escalation or resolution. His separate comment that diesel has likely peaked points to a narrative now diverging from crude, even as both remain tied to the same unresolved standoff at Hormuz.