BY COMFORT OGBONNA
Oil prices moved higher on Wednesday, recovering from a seven-week low reached in the previous session as renewed military tensions between the United States and Iran raised concerns about potential supply disruptions. The rebound was also supported by fresh data showing a significant decline in U.S. crude oil inventories, signaling tighter market conditions.
Brent crude futures gained 66 cents, or 0.7%, to trade at $92.11 per barrel, while U.S. West Texas Intermediate (WTI) crude rose 60 cents, or 0.7%, to $88.80 per barrel during early trading. The gains came after a volatile trading session that had pushed prices to their lowest levels in nearly two months.
Market sentiment shifted after the U.S. military carried out new strikes on Iranian targets. The military action followed a pledge by President Donald Trump to retaliate for the downing of a U.S. Apache attack helicopter, an incident that has further heightened tensions in the Middle East. The latest developments have increased fears that the fragile ceasefire between Washington and Tehran could collapse, potentially leading to a broader escalation in the region.
Analysts said the renewed military confrontation has forced traders to refocus on geopolitical risks after recent optimism that diplomatic efforts could help stabilize the situation. Concerns about disruptions to oil production and transportation routes remain a key driver of market movements, particularly given the Middle East’s critical role in global energy supplies.
According to market analysts, the latest exchanges between the United States and Iran have reintroduced a risk premium into crude markets. While negotiations and diplomatic initiatives continue behind the scenes, investors remain cautious as any further escalation could significantly affect global oil flows and tighten supplies.
The situation has been further complicated by Iran’s warning that it could resume hostilities if Israel continues military operations against Hezbollah in Lebanon. Efforts to transform the current ceasefire into a long-term settlement have faced major obstacles, with regional conflicts continuing to undermine progress toward a lasting peace agreement.
Commodity strategists noted that the absence of a clear diplomatic breakthrough, combined with an increasingly tight oil market, creates favorable conditions for higher prices. Analysts believe crude could see further gains if current disruptions persist into the third quarter of the year, a period traditionally associated with stronger global fuel demand due to increased travel and economic activity.
Adding to market concerns is the continued disruption of shipping through the Strait of Hormuz, one of the world’s most important energy transit routes. The waterway typically handles roughly one-fifth of global crude oil and liquefied natural gas shipments. Restrictions on vessel movements through the strait have intensified worries about supply bottlenecks, while Washington’s blockade of Iranian ports has added another layer of uncertainty to international trade flows.
Despite these challenges, U.S. officials indicated that shipping activity in the Gulf region and oil exports passing through the Strait of Hormuz have shown signs of improvement. However, traders remain wary as negotiations aimed at ending the conflict have yet to produce a lasting resolution after more than three months of hostilities.
Support for oil prices also came from signs of tightening supplies in the United States. Industry data released on Tuesday showed that U.S. crude inventories fell for an eighth consecutive week, highlighting strong demand and limited supply growth. The sustained decline in stockpiles has reinforced expectations that the market may remain undersupplied in the near term.
According to market sources familiar with data from the American Petroleum Institute, U.S. crude inventories dropped by approximately 9.12 million barrels during the week ending June 5. Gasoline inventories also declined by around 1.19 million barrels, suggesting continued strength in fuel consumption despite concerns about global economic growth.
The sharp decline in crude stockpiles is particularly significant because the United States has become a crucial supplier of oil and refined products during the ongoing conflict. American exports have helped fill supply gaps in both Asian and European markets, providing stability amid geopolitical uncertainty.
Analysts warned that lower U.S. inventories could limit the country’s ability to maintain elevated export levels in the coming months. If domestic stockpiles continue to shrink while global demand remains firm, international buyers may face tighter supplies, potentially placing additional upward pressure on crude prices.
With geopolitical tensions showing little sign of easing and supply fundamentals becoming increasingly supportive, oil markets are likely to remain highly sensitive to developments in the Middle East and inventory trends in major consuming nations. Investors will continue to monitor military activity, diplomatic negotiations, and supply data closely as they assess the direction of energy prices in the weeks ahead.
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