[MARKET UPDATE] Oil ticks higher as Yemeni Houthis expand their targeting of Saudi ships to the northern Red Sea

In terms of Middle Eastern geopolitics, developments suggest momentum towards a diplomatic agreement to reopen the Strait of Hormuz, although negotiations remain ongoing. US President Trump said in a Fox News interview that the Strait could reopen very soon, describing discussions with Iran as productive after an all-day round of negotiations and stating there is still ample time to reach a deal, while warning that Iran would face severe consequences if it withdrew from talks again. He later added that negotiations were progressing well and that more clarity would emerge within 48 hours. According to Axios, the US is targeting a Wednesday announcement of a Hormuz agreement under which inbound vessels would transit through a northern lane in Iranian waters and outbound vessels through a southern lane in Omani waters, with no transit fees during an initial 60-day period and joint efforts to clear naval mines from the median lane within 30 days before negotiating a permanent arrangement between Oman and Iran. Supporting this, a source familiar with Iran-Oman talks told CBS News that discussions are now focused primarily on the practical implementation and timing of reopening the strait, with the broad framework already largely agreed. However, Israeli media, citing unnamed sources, claimed Trump and his advisers are pursuing a deal with Iran at almost any cost. Energy futures have tilted higher during the European morning following a subdued APAC session, with gains seen after the Yemeni Houthis announced that they have targeted a Saudi tanker in the North of the Red Sea. This essentially amounts to an expansion of the Houthi blockade that threatens to completely choke off Saudi Arabia's alternative energy export routes. Prices thereafter saw modest downticks on reports that the Pakistan PM Sharif and Army Chief Munir will visit Saudi Arabia tomorrow. Meanwhile, upticks were seen once again following reports that Israeli strikes reported in Southern Lebanon, which is seen as a headwind for US-Iran negotiations. WTI Sep’26 resides towards the top end of a USD 74.24-76.35/bbl range (vs yesterday’s USD 75.11-82.33/bbl range) while Brent Oct’26 trades in a USD 78.11-80.55/bbl range (vs yesterday’s 78.67-86.33/bbl parameter). Dutch TTF is softer intraday but in choppy trade, printing on either side of the EUR 55/MWh mark in a current ~EUR 54.50-55.75/MWh range. Metals are firmer as DXY price action is once again somewhat contained despite the volatility across energy. Spot gold trades towards the top end of a USD 4,065-4,180/oz range after topping the 22nd July high (USD 4,166/oz) to match the 7th July peak (USD 4,180/oz). spot silver has mounted USD 60/oz once again to trade towards the upper end of a USD 59.40-61.90/oz range at the time of writing. Base metals also cheer the relatively stable dollar against the backdrop of energy volatility. 3M LME copper holds above USD 14k/t in a USD 13,974.45- 14,104.00/t range at the time of writing.