Supply tightening and geopolitical risks keep oil prices at more than three-week highs

1. International oil prices continued their upward momentum on Wednesday, with Brent crude futures rising 0.3% to $91.82 per barrel and WTI crude September futures up 0.2% to $86 per barrel, not far from the over three-week high set overnight. This round of gains mainly reflects resource scarcity risks rather than position adjustments driven by news.2. Commercial shipping in the Strait of Hormuz is nearing paralysis, as shipowners are reluctant to deploy capacity and maritime passage conditions remain contested. The temporary ceasefire expired on Monday. Trump stated that there are currently no negotiations with Iran and insisted the strait remains open, which contradicts Tehran's position that the waterway is still closed. Iran has linked reopening the strait to lifting sanctions, unfreezing assets, and removing the maritime blockade.3. Supply tightening has spread beyond West Asia. Due to disruptions at the Novorossiysk port, Russia's crude oil daily output from western ports dropped to about 2.3 million barrels in the first half of August, 15% below the planned loading volume. Saudi Aramco has shifted to ship-to-ship transfers off the UAE coast, a slower and costlier alternative.4. Forward structures have strengthened bullish signals, as near-month contracts carry a premium of about $4 over contracts two months out, reflecting increasingly tight spot supply. Diesel flow from the Gulf of Mexico is down roughly 80% year-on-year, and crude flow has decreased by 48%. India's MCX crude futures have risen for the fourth consecutive trading day, with the September contract up nearly 1% to 8,145 rupees per barrel.