The prospects for navigation through the Strait of Hormuz are still uncertain! Iran and Oman have yet to reach a new channel agreement+Saudi refinery attacked, oil prices continue to rise

The Zhitong Finance App learned that since Iran and Oman have yet to reach an agreement to reopen the Strait of Hormuz, and the Houthis also claim to have attacked a Saudi oil refinery close to the Red Sea, oil prices continue to rise. After a cumulative increase of more than 5% in the previous three trading days, as of press release on Monday, the price of Brent crude oil futures rose more than 2% to 84.37 US dollars/barrel; WTI crude oil futures were reported at 78.75 US dollars/barrel.

Iranian Foreign Minister Abbas Alagach said this past weekend that Iran and Oman are “very close” to reaching an agreement to establish a shipping route through the Strait of Hormuz. But at the same time, he also reiterated that deciding on a new route between Iran and Oman does not mean reopening the Strait of Hormuz. This lowered the market's expectations that energy transportation in the Middle East could resume quickly.

According to reports, Zulghader, secretary of Iran's Supreme National Security Council, said that if the US does not change its behavior, the Strait of Hormuz will remain closed. The prerequisite for reopening the Strait of Hormuz is that the US fulfills five conditions, namely permanently stopping military operations against Iran and its allies in the region, stopping threatening or insulting Iran, lifting the maritime blockade and all sanctions against Iran, returning Iran's frozen assets, and compensating Iran for losses caused by related military actions.

Iran has ruled out the possibility of direct dialogue with the US on the grounds that the US has repeatedly violated the short-lived temporary peace agreement. Alagzi said that the mediators are still trying to find a way to restart negotiations. Until the US stops violating the Memorandum of Understanding and makes amends for related breaches, Iran believes that the two sides have no possibility of restarting negotiations.

US President Trump, on the other hand, sent a signal of patience. In an interview last Sunday, he said that the US is currently “handling this issue in a low-key manner.” This statement was made after Trump repeatedly threatened large-scale military attacks against Iran over the past few weeks, but then chose to back down.

Furthermore, the Yemeni Houthis, backed by Iran, claimed to have attacked Saudi Arabia's Jizan oil refinery. Meanwhile, an oil tanker operated by the Abu Dhabi National Oil Company was also attacked near the Strait of Hormuz last weekend.

The risk of another outbreak of conflict in the Middle East remains high, causing the market to remain alert. Harris Kursheed, chief investment officer of Chicago's Karobaar Capital LP, said: “As long as the market prices are still based on the 'possibility' of supply disruptions rather than the certainty that the situation will return to normal, the market trend will maintain a bullish trend.” “Until we see actual traffic flow returning to normal, I think geopolitical risks will continue to support crude oil prices.”