Crude oil prices ended Tuesday higher for a third consecutive session and at their highest levels in more than three weeks, as the prospects of an agreement between the US and Iran fade, Tehran warns that it is adopting a more aggressive military stance and insists that the Strait of Hormuz will remain closed, while Washington has ruled out extending the ceasefire. At the same time, continued attacks on vessels and new missile threats in the Middle East are sustaining uncertainty around global energy flows.

Brent futures rose 15 cents, or 0.17%, to close at $91.02 per barrel, while US West Texas Intermediate (WTI) gained 44 cents, or 0.52%, to $84.94. Both contracts closed at their highest levels since July 24.

The gains, however, remained relatively limited, as the market appears to have become less sensitive to the constant flow of geopolitical news.

“To some extent, the market has toned down its reactions to daily headlines because of the amount of noise since June without any substantial results,” said Darrell Fletcher, managing director of commodities at Bannockburn Capital Markets.

According to him, the hidden or “dark” oil shipments managing to pass through the Strait of Hormuz appear to be greater than the market had expected, providing some protection against even larger price increases.

Oil continues to pass through Hormuz

Despite Tehran’s insistence that the Strait remains closed, some quantities of oil continue to make their way through Hormuz.

Saudi Aramco has resumed oil loadings from inside the Strait and is offering cargoes through ship-to-ship transfers off Fujairah in the United Arab Emirates, according to shipping data and market sources.

Meanwhile, two major Chinese shipping groups have begun taking oil cargoes outside the Gulf, according to industry executives, tanker-tracking data and shipbrokers.

These moves have to some extent reduced fears over supply. However, vessel traffic through the strategic waterway remains in the single digits in terms of crossings. These figures also do not include vessels that may be transiting the Strait with their transponders switched off.

Hopes for an agreement are fading

Iran’s top negotiator, Mohammad Bagher Ghalibaf, said Iran would keep the Strait of Hormuz closed until the US fulfills the terms of the interim agreement signed in June.

US President Donald Trump, for his part, who had previously described the agreement as “done,” made clear on Tuesday that no talks are taking place or have been scheduled between Washington and Tehran, while also maintaining that the Strait is open.

His comments triggered only a limited reaction in the market, as investors now appear more focused on actual oil flows than on conflicting statements from the two sides.

Ghalibaf’s remarks followed a warning from a senior Iranian official to Reuters that Tehran would adopt a “fully aggressive” military posture as efforts to reach a permanent end to the war have stalled.

Mohit Kumar, an economist at Jefferies, estimated that neither country has yet reached the point where the cost of the confrontation would force it to seek a compromise.

“We therefore see further pressure in the short term and upward pressure on oil prices,” he said.

At the same time, Iran is separately negotiating with Oman over an agreement to manage the Strait of Hormuz, with Tehran claiming that the two sides are close to a deal. Trump, however, has responded to those contacts by threatening to bomb Oman, a long-standing US security partner.

Attacks in the Middle East continue

The geopolitical situation is further complicated by continuing attacks on ships and missile threats across the region.

Yemen’s Houthis announced that they had launched missiles at vessels in the Red Sea, which they described as a Saudi military ship and four escort vessels.

Meanwhile, the UK Maritime Trade Operations (UKMTO) said it had received a report of a vessel being struck by an unidentified projectile while leaving the Strait of Hormuz. The strike damaged the engine room and reportedly injured a crew member.

Later, the United Arab Emirates announced that it had detected two ballistic missiles launched from Iran toward the country. Tehran did not immediately comment.

Russia redirects oil flows

Disruptions to energy transportation are not limited to the Middle East. According to four Reuters sources, Russia is redirecting Kazakhstan’s crude oil exports from the Baltic port of Ust-Luga to Novorossiysk on the Black Sea.

The move frees up capacity at Ust-Luga for additional Russian crude exports from the Baltic, as security risks in the Black Sea have increased.

In this way, Moscow can replace the Kazakh barrels previously loaded at Ust-Luga with its own oil, at a time when Ukrainian drone attacks are making it more difficult to secure tankers for Russian shipments in the Black Sea.