USO jumps on Strait of Hormuz supply fears
CNBC reports USO is up 1.85% on the day, at $156.40 a share, as oil markets react to Strait of Hormuz supply fears.
Published
US crude oil futures are climbing Thursday as traders weigh the risk of supply disruption after attacks on ships passing through the Strait of Hormuz, CNBC reports.
Firas Bechwaty, an executive at trading platform ICM, told CNBC that the lack of progress on the US-Iran diplomatic track leaves little immediate prospect of a full reopening of the strait. The International Energy Agency's October report, released Wednesday, warned that constraints on diesel markets could persist into next year and said fresh attacks on Saudi Arabia threaten to derail a recovery in oil supply, CNBC reported. Reuters has also reported that the Trump administration is considering easing sanctions on so-called shadow fleet vessels that carry oil and petroleum products from countries including Russia.
The scale of Thursday's advance in WTI marks a sharp break from the sideways-to-soft tone crude has carried in recent weeks, data from Investing.com show, with the contract having already risen for three straight sessions into Thursday's trade. Without a single confirmed catalyst tying the size of the move to a specific supply or demand event, traders are likely to want to see the gain hold over the next session or two before treating it as more than a one-day spike.