WTI and Brent snapped a multi-day, Hormuz-linked decline the same day Qatar's foreign minister met his Iranian counterpart in Tehran. Iranian officials say no final agreement exists, and a tanker hit near Oman two days ago still has no named attacker.
WTI crude rose to $84.09 today, up 2.26% on the session, trading in a range of $80.67 to $84.24 against a previous close of $82.23. Brent climbed to $88.99, up 2.64%, ranging between $85.32 and $89.15 against a previous close of $86.70. Both mark a reversal, not a continuation, of the decline that had pulled crude lower over the prior several sessions on Hormuz-related concerns. As of this morning, that decline had stalled without turning around. By this afternoon, it had turned around.
The reversal landed the same day as new diplomatic movement. Qatar's Prime Minister and Foreign Minister, Sheikh Mohammed bin Abdulrahman Al Thani, met Iranian Foreign Minister Abbas Araghchi in Tehran. It was reported as the first high-level Qatari visit to Iran's capital since fighting began around late February. The two sides reportedly discussed a phased plan for the Strait of Hormuz that would include a temporary shipping corridor and a joint mine-clearing project. Iranian officials stated explicitly that no final agreement has been reached.
The Qatar-Iran meeting coincided with crude's reversal, but the available timing does not show that the talks caused the move.
The reversal also arrives against an unresolved security backdrop. A tanker was struck by an unknown projectile near Khasab, Oman, on August 25 at 1730 UTC, according to a UKMTO advisory. The strike caused a fire that was subsequently extinguished. The crew was reported safe, with no casualties and no reported environmental damage. An investigation by local authorities is ongoing. The advisory does not name the vessel, its flag, or assign responsibility to any party.
Markets moved as though the risk premium built up over the prior decline is starting to come out of the price. The diplomatic record says otherwise, or at least says it isn't finished: a new mediator has entered the picture, a framework has reportedly been discussed, and Iranian officials themselves are the ones saying nothing has been finalized. A shipping corridor and a joint mine-clearing project are specific, concrete proposals. Neither has been agreed to.
Crude's reversal prices in progress. The paperwork doesn't exist yet.