Oil prices jumped on Wednesday, reversing earlier losses after reports of gunfire attacks on at least three container ships in the Strait of Hormuz and a lack of progress in peace talks between the U.S. and Iran.
Brent crude futures were up 73 cents, or 0.7%, at $99.21 a barrel at 1049 GMT. West Texas Intermediate futures were up 59 cents, or 0.7%, to $90.26. Both benchmarks climbed about 3% on Tuesday.
At least three container ships were hit by gunfire in the Strait of Hormuz on Wednesday. Iran's Revolutionary Guards seized two vessels for what it described as maritime violations and transferred them to Iranian shores, the semi-official Tasnim news agency reported.
Iran and the U.S. have imposed restrictions on ships using the strait, which until the Iran war began at the end of February had carried about 20% of global oil and liquefied natural gas supplies.
Earlier, U.S. President Donald Trump said he would indefinitely extend the cease-fire with Iran, hours before it was due to expire. Neither side showed up for peace talks in Pakistan.
The cease-fire announcement appeared to be unilateral, and it was not immediately clear whether Iran, or U.S. ally Israel, would agree to extend the truce, which began two weeks ago.
A Liberia-flagged container ship was reported on Wednesday to have sustained damage to its bridge after being hit by gunfire and rocket-propelled grenades northeast of Oman.
The United Kingdom Maritime Trade Operations (UKMTO) said the master of the vessel reported being approached by an Iranian gunboat. The vessel, it said, was subsequently fired upon. All crew members were safe and there was no fire or environmental impact due to the incident.
Maritime security sources said that three people were onboard that gunboat.
The master of the Greek-operated container ship also reported that no radio contact was made prior to the incident and that the vessel had been initially informed that it had permission to transit the Strait of Hormuz.
The UKMTO later said that a second container vessel had been fired upon about eight nautical miles west of Iran. The Panama-flagged vessel was not damaged and its crew members are safe.
Maritime security sources said that a third container ship was fired upon about eight nautical miles west of Iran while transiting outbound of the Strait of Hormuz. The Liberia-flagged vessel, which was not damaged had stopped in the water. Its crew are safe, the sources said.
In Europe, Ukrainian President Volodymyr Zelenskyy said the Druzhba pipeline carrying Russian oil was ready to resume operations. Three industry sources, however, said Russia was set to stop oil exports from Kazakhstan to Germany via the pipeline from May 1.
Later on Wednesday, the U.S. Energy Information Administration is due to publish weekly inventory data. Crude stocks fell by 4.5 million barrels last week, while gasoline and distillate stocks also declined, market sources said, citing American Petroleum Institute figures.
Analysts estimated a 1.2 million-barrel draw of crude for the week ended April 17.
"If the EIA confirms the draws and U.S. weekly exports of both crude oil and refined products remain robust, this will be taken as confirmation that consumers in Europe and the Far East are scrambling to secure oil supplies wherever, whenever, and however they can," PVM analysts said.