Oil prices swung sharply Tuesday as conflicting reports about shipping in the Strait of Hormuz drove the cost of crude oil down for much of the morning, then higher in the afternoon.
U.S. West Texas Intermediate crude oil plunged as much as 19%, slipping below $77 per barrel at one point. But the move faded, and West Texas Intermediate climbed to trade around $89 a barrel by 4 p.m. ET. International Brent crude also briefly dropped 17% to below $80 per barrel but later rose back to more than $90 per barrel.
Stocks also closed mixed after a volatile trading session Tuesday. The S&P 500 ended lower by 0.21% after having risen almost 1%, while the Nasdaq Composite wrapped up the day flat and the Dow Jones Industrial Average fell 34 points.
Oil's move lower was accelerated by a social media post from U.S. Energy Secretary Chris Wright that was later deleted and denied by the White House.
Wright had written on X that the "U.S. Navy successfully escorted an oil tanker through the Strait of Hormuz to ensure oil remains flowing to global markets."
A spokesperson for the agency blamed “Department of Energy staff” for having “incorrectly captioned” a video of Wright.
White House press secretary Karoline Leavitt told reporters, "The U.S. Navy has not escorted a tanker or a vessel at this time."
Leavitt also said the offer of a U.S. escort remained available to ships in the strait.
Security for oil tankers in the Strait of Hormuz has quickly emerged as the key factor affecting the supply and price of crude oil around the world.
“Policy measures may have limited impact on oil prices unless safe passage through the Strait of Hormuz is assured,” JPMorgan Chase commodities analysts wrote in a note Tuesday.
The strait typically carries ships responsible for moving more than 20% of the world’s oil supply to the global market.
Tankers have stopped transiting the strait since the U.S.-Israeli war on Iran started Feb. 28. The supply bottleneck is the reason crude oil prices are up more than 20% since the war started.
Canadian Prime Minister Mark Carney said leaders of the Group of Seven leading industrial nations plan to convene Wednesday for a virtual meeting “to discuss coordination" on global energy supplies.
Energy ministers from leading industrialized nations met Tuesday morning to discuss options to respond to rising crude oil prices, but they did not announce a strategic release of petroleum reserves afterward, which was widely viewed as a front-line response in the effort to calm global markets.
After the G7 meeting, French Finance Minister Roland Lescure, who also oversees energy policy, said officials had asked the International Energy Agency to "look into details that we could have at hand were we to decide to use" international oil reserves to calm markets.
A U.S. official told NBC News this week that President Donald Trump was reviewing a number of other options to drive down prices, including restricting U.S. exports, intervening in the futures market and lifting some requirements of the Jones Act, which requires that domestic fuel be carried only on U.S.-flagged ships.
The White House has also repeatedly said that the spike in energy prices was only "short-term" and that it would drop after the objectives of the war were met.
So far, since the war started, retail gas prices have risen 50 cents, a visible reminder to consumers about the impact it is having already.
