The front month Nymex WTI crude contract is up by more than 5pc on Monday after retracing initial gains made on attacks from the US and Israel on Iran.
April Nymex WTI was trading near $70.60/bl at 12:30pm ET on Monday, up by $3.58/bl, or 5.3pc, from the previous settle on 27 February after the US and Israel launched a major attack against Iran on 28 February.
Prices surged as high as $75.33/bl on 1 March, up by 12pc or $8.31/bl, before falling back closer to $70/bl.
US president Donald Trump on 1 March called on members of Iran's Revolutionary Guard Corps (IRGC) and other uniformed personnel to lay down arms "and receive full immunity, or face certain death". Trump also called on "all Iranian patriots who yearn for freedom to seize this moment, to be brave, be bold, be heroic, and take back your country".
Tehran said it will not negotiate with the US, as the widening conflict in the Mideast Gulf enters into its third day and has sharply raised the risk of disruptions to oil and gas supply.
Most shipowners are avoiding transits through the strait of Hormuz because of the fighting. Insurers have also cancelled war risk coverage for ships in most regions where the fighting is taking place.
Saudi Arabia ships around 6.5mn b/d from ports in the strait of Hormuz, Iraq some 3.3mn b/d and the UAE slightly over 1mn b/d, Vortexa data indicate. Of the major regional producers, only Omani exports are not directly exposed to the strait, loading instead from Duqm in the Arabian Sea.
Approximately 20 unladen very large crude carriers (VLCC) are waiting just southeast of the strait of Hormuz currently, with some bookings cancellations likely if some of them cannot meet their loading dates.
At least three vessels have been hit by explosive projectiles near the strait of Hormuz since the conflict began. Port infrastructure has also sustained damage, including at Duqm's commercial port in Oman.
