Crude oil prices reversed their recent downward trend on Thursday, climbing as new information emerged regarding Iran’s plans for the Strait of Hormuz. Both Brent and West Texas Intermediate benchmarks saw notable gains throughout the trading session after reports surfaced that a draft plan for the waterway included significant restrictions on vessel traffic.
Markets had previously tracked toward lower prices earlier in the week. Speculation regarding a potential agreement between Iran and Oman, which aimed to secure freedom of movement through the shipping channel, had acted as a cooling agent for oil prices. Investors reacted to comments from Treasury Secretary Scott Bessent, who had suggested a deal was near.
However, the outlook shifted when the Iranian state news agency, Fars, published a draft proposal that moved in a different direction. According to the document now under parliamentary review, the plan proposes strict conditions for passage. The proposal includes provisions to block ships from the United States and Israel from using the route. It also outlines potential penalties for other nations that have previously acted against Iran, demanding compensation before transit rights are granted.
Beyond these regulatory hurdles, the region remains tense. Reports indicate ongoing regional conflicts, including claims from Iranian allies in Yemen regarding attacks on Saudi interests. Simultaneously, separate incident reports near the Strait of Hormuz have heightened concerns about the safety of maritime trade. As market participants monitor these developments, the path toward a stable agreement for this critical chokepoint remains uncertain.