US-Sanctioned Tanker Linked To China Tests Trump Blockade

A US-sanctioned tanker linked to China sailed out of the Strait of Hormuz and into the Gulf of Oman, testing President Donald Trump’s naval blockade.

Rich Starry, a medium-range tanker earlier known as Full Star, was blacklisted by Washington in 2023 for helping Tehran evade energy sanctions. It is not clear on this occasion whether it visited Iranian ports before its transit, or is carrying cargo. Bloomberg's Adam Farrar joins to discuss. Oil held a drop, with the US and Iran looking to arrange a second round of peace talks in the coming days, as a blockade of the Strait of Hormuz continued to impede energy supplies vital for the world economy.

Brent steadied above $94 a barrel after losing nearly 5% on Tuesday, while West Texas Intermediate was near $90. The objective is to hold more talks before a ceasefire expires next week, according to people familiar with the matter. One proposal is a return to Pakistan, though other venues are being considered.

President Donald Trump said talks could resume “over the next two days,” the New York Post reported. He saw the war as being “very close to over,” Fox Business anchor Maria Bartiromo said after interviewing the US leader.

In the meantime, the US is pressing ahead with a naval blockade of Hormuz to curb the Islamic Republic’s oil exports. For its part, Tehran is considering a pause to shipments through the waterway to avoid testing the US cordon, according to a person familiar with the matter. Since the war erupted, Iran has moved to prevent the passage of almost all shipping through the key route. The global oil market has been jolted by the conflict, which triggered an unprecedented supply shock. Surging prices for physical crude and products such as gasoline are squeezing consumers and hurting demand, with the International Energy Agency forecasting a drop in consumption this year.

“In the near term, oil is likely to move sideways with a softer bias, as the market digests the shift toward diplomacy,” said Dilin Wu, a research strategist covering cross-asset markets at Pepperstone Group.

Read More: US Says Six Ships U-Turned in First Day of Hormuz Blockade

“However, even if geopolitical tensions ease at the margin, any meaningful recovery in physical supply will lag,” with logistical bottlenecks off Hormuz keeping a floor under prices, Wu added.

Should escalation risks fade, oil supply from the Middle East may see a “tiered recovery,” with 2 million to 3 million barrels-a-day of output likely to be restored in the first four weeks, according to ANZ Group Holdings Ltd. In a bid to exert further pressure on Tehran, the Trump administration will allow a waiver temporarily authorizing the purchase of certain Iranian crude to expire this weekend, according to the Treasury Department.

“Headlines continue to dominate price action, with markets leaning toward a normalization of flows by the end of April,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Group. “Sustained increases in traffic will be the key signal to watch, alongside the trajectory of negotiations.”

In the US, the American Petroleum Institute reported nationwide crude inventories rose 6.1 million barrels last week. If confirmed by official data later Wednesday, that would mark the eighth consecutive build.

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