Oil prices rise but gain capped on report phased opening of Hormuz Strait under discussion

Oil prices rose Thursday but were off session highs on a report that U.S. and Iranian negotiators are discussing a phased deal to end the standoff in the Persian Gulf.

Brent crude, the international benchmark, rose 2.5% to $105.69 a barrel. U.S. West Texas Intermediate futures moved 2.3% higher to $94.30.

U.S. and Iranian negotiators are holding discussions in New York, sources told Reuters. A senior Iranian official told Reuters the most realistic path forward is for Tehran to allow navigation in the Strait of Hormuz in exchange for the U.S. endings its blockade.

But tensions in the Middle East remain high. The Saudi military intercepted six ballistic missiles fired by the Houthis at the Red Sea port city of Yanbu and Taif, a spokesperson said.

Meanwhile, tensions continue to simmer between the U.S. and Iran after Iranian President Masoud Pezeshkian blamed the U.S. and Israel for stoking global instability.

“The United States president described us as terrorists. We have been the victims of terrorism,” Pezeshkian said, according to a live translation of his speech at the United Nations General Assembly. Pezeshkian also asserted that his country will continue to fight back “until our last breath.”

Traders are also assessing a report that Asia is on track to import its highest volume of crude oil since the start of the war.

Asia’s imports of crude oil rose in September to the highest level since the start of the Iran war, Reuters reported. The region is on track to import 23.96 million barrels per day ​in September, up from 23.38 million bpd in August and the most since February, Reuters said, citing data compiled by commodity analysts Kpler.