Oil up 1% after Iran says no nuclear material will leave the country

LONDON: Oil prices rose about 1% on Wednesday after dropping to two-month lows in the previous session, after Iran’s security chief said Tehran would not allow any enriched nuclear material to leave the country.

Washington has said nuclear matters must be part of any initial negotiations with Tehran aimed at ending the US-Israeli war on Iran.

Brent futures were up $1.22, or 1.3%, at $92.71 a barrel by 1412 GMT. US West Texas Intermediate crude gained $1.09, or 1.3%, to $87.13.

In the previous session, oil prices initially fell by more than $3 a barrel after US officials played down the need for further military strikes against Iran. Prices later pared some losses after an Iranian security official said no talks were taking place between the two sides.

“Oil prices are being supported by fading hopes of an imminent de-escalation,” UBS analyst Giovanni Staunovo said.

Iran says five tankers and tugboat caught fire in Hormuz

There is little sign of attacks in the Strait of Hormuz easing after 37 ships were attacked in October, the highest monthly total since the start of the war, according to data from the Washington Institute for Near East Policy.

“There has been an increase of vessel attacks in the Gulf shipping lanes amidst uncertainty of the diplomacy talks,” said June Goh, senior analyst at Sparta Commodities.

She added that the key driver for the market was whether Iran would engage with US demands to reach a diplomatic agreement.

A tanker was struck northeast of Lima in Oman, the United Kingdom Maritime Trade Operations agency said on Tuesday. Iran’s Revolutionary Guards Navy said separately on Tuesday that two tankers caught fire after hitting naval mines on an “unauthorized route” in the strait.

“Even in the event a deal is struck, an increase in flows through the waterway would still depend on mine clearance, insurance costs and whether or not shipowners would even be willing to take the risk,” LSEG Oil Research said in a November 10 note.

Hormuz vessel crossings extend slide on fresh US-Iran attacks

On the supply side, US crude stocks rose by 9 million barrels in the latest week, market sources said, citing data from the American Petroleum Institute. Official data is due later on Wednesday.

Separately, a regional governor said a drone attack caused a fire in the port area of Ust-Luga on Russia’s Baltic coast, injuring three workers.

Russian oil refining capacity has been reduced by about 30% since late October following renewed Ukrainian drone attacks, industry sources said.

Russian and Ukrainian officials met in Abu Dhabi on Tuesday for their first peace talks since February as envoys for US President Donald Trump launched a fresh push to end the war.