Oil Traders Reprice Hormuz Risk as Demand Outlook Deteriorates

AI Summary

Oil traders are adjusting the premium for risks in the Strait of Hormuz amid weakening demand forecasts despite stable supply concerns. September WTI crude futures saw gains as the market recalibrated risk sentiment after prior optimism faded.

September WTI crude oil futures are trading at $81.19 late Thursday, up $4.11, or 5.33%, for the week. With Friday’s session still to come, the final weekly result remains unsettled. The message is clear. Traders spent the week rebuilding the Hormuz premium after last week’s deal optimism fell apart, then had to deal with an inventory report and demand forecasts that argued crude had moved too far, too fast. The contract did not rally because of a new supply loss. The supply problem was already there. What changed was the market’s…