US expands alternate shipping route off Oman as Hormuz tensions spike

Key Facts

Amid escalating geopolitical tensions in the Gulf, the United States has announced the expansion of an alternate shipping route along Oman's coast to accommodate inbound and outbound traffic after a series of attacks with Iran over the Strait of Hormuz, according to reports. The move follows Iranian attempts to disrupt competing lanes, leading to continued military exchanges and the need for a secure passage for oil tankers.

According to market data, West Texas Intermediate crude traded around $85.50 per barrel at the June 26 close, while Brent stood at $89.20, buoyed by supply-disruption fears. The Strait of Hormuz handles roughly 20% of global oil flows, meaning any escalation risks pushing energy prices and shipping costs higher, especially as reciprocal attacks between Washington and Tehran persist.

Traders are watching the American Petroleum Institute's crude stockpile data released on June 23, which showed a draw of 765,000 barrels, a supportive factor for prices. Markets are also awaiting any further diplomatic or military developments in the region, as the supply-disruption risk remains elevated despite the alternate route expansion, keeping upward pressure on oil and freight costs.