Oil Prices Rise on Hormuz Stalemate; Bakken Differential Widens

Oil prices climbed in morning trading on Wednesday, with Brent crude topping $89 per barrel, as a stalemate between the U.S. and Iran over control of the Strait of Hormuz continues to inject a risk premium into the market. According to live price data, West Texas Intermediate (WTI) crude was at $83.65 per barrel, up $0.45, while Brent traded at $89.21, up $0.30. The discount for Bakken crude versus WTI widened to $3.42.

The price support stems from contrasting claims about the critical Middle Eastern waterway. According to a report from OilPrice.com, Iran stated on Tuesday that the Strait of Hormuz will remain closed unless the United States meets its conditions. Later the same day, U.S. President Donald Trump asserted that the United States has "total control" over the strait. Former U.S. deputy secretary of state Wendy Sherman described the situation as a stalemate, telling Bloomberg TV that a sustainable reopening appears unlikely without significant concessions.

While U.S. Secretary of Energy Chris Wright claimed regional oil flows had normalized, ship-tracking data indicates vessel traffic at the strait declined this week amid security concerns, according to the OilPrice.com report. This disconnect between official statements and on-the-ground data is keeping traders focused on supply disruption risks.

For Bakken operators, the rising global benchmark prices are a positive signal, but the widening local differential presents a headwind. A Bakken differential of $-3.42 means Bakken-grade crude is selling for roughly $80.23 per barrel at the wellhead, all else being equal. This discount reflects local transportation costs, pipeline capacity, and quality adjustments relative to the WTI benchmark traded in Cushing, Oklahoma.

The sustained geopolitical tension provides underlying support that helps offset bearish pressures from other factors, such as potential economic slowdowns or OPEC+ production decisions. For North Dakota producers, the key metric remains the realized price after the differential is applied. The current spread indicates Bakken crude is competitively priced to move to market, but it also reduces the direct benefit from the day's gains in the headline WTI price.

The natural gas market also saw modest gains, with prices rising $0.02 to $2.79 per MMBtu. While less directly impacted by Middle Eastern tensions, natural gas prices remain a critical component of the economics for many Bakken wells, which often produce significant associated gas.