Oil prices ticked higher in early trade on Wednesday, driven by supply uncertainty as investors considered conflicting messages from Tehran and Washington on the Strait of Hormuz.
Brent crude futures rose 26 cents, or 0.29%, to $91.28, while U.S. West Texas Intermediate crude futures gained 37 cents to $85.31 a barrel.
The uncertainty stems from a temporary ceasefire agreement that expired on Monday, with Iran moving to a 'fully offensive' military posture, according to a senior Iranian official. However, U.S. President Donald Trump insisted the Strait of Hormuz was open, contradicting Iran's assertion.
To avoid the Strait of Hormuz, Iraq's cabinet approved mechanisms for exporting Iraqi crude through specialized international and local companies, starting September 1.
Two Chinese shipping giants have stopped sending oil tankers through Hormuz and the Bab al-Mandeb strait, instead collecting oil cargoes outside the Gulf.
In the U.S., crude oil and distillate inventories fell, while gasoline stocks rose last week, according to market sources citing data from the American Petroleum Institute.
Official inventory numbers from the U.S. Energy Information Administration are due on August 20, with analysts expecting crude stocks to fall by about 600,000 barrels in the week ended August 14.
