WTI climbs above $86.50 on renewed US–Iran Strait of Hormuz tensions

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $86.70 during the Asian trading hours on Monday. The WTI price rises on renewed tensions between the United States (US) and Iran in the Strait of Hormuz. Traders brace for the American Petroleum Institute (API) report, which will be published later on Tuesday. 

Iran's military said that the United States (US) violated the ceasefire by firing at one of Iran's commercial ships, per Bloomberg. Iran stated that it will soon respond and retaliate against this maritime and armed robbery by the US military.

On Sunday, Iran denied it would participate in new peace talks with the US, hours after US President Donald Trump said its negotiators would head to Pakistan on Monday for a second round of peace talks with Iran. Fears of supply disruption could boost the WTI price in the near term. 

Traders brace for the release of the API report later on Tuesday. A larger-than-expected crude oil inventory draw indicates stronger demand and could lift the WTI price, while a bigger build than estimated signals weaker demand or excess supply, which might weigh on the WTI price.