The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.

1947 ET - Oil edges higher in early Asian trade amid lingering tensions in the Middle East, which could lead to more supply disruptions. The U.A.E. "said that it was cutting all economic ties with Iran after it accused it of firing ballistic missiles at its territory," ANZ Research analysts note. "While U.A.E.'s energy infrastructure was not targeted, it closes another potential avenue for diplomatic efforts to end the conflict and reopen the Strait of Hormuz," the analysts say in a research report. The strait is a key waterway through which one-fifth of the world's oil is transported. Front-month WTI crude oil futures are 0.1% higher at $85.88 a barrel. (ronnie.harui@wsj.com)

1520 ET - Oil futures rise for a fourth straight session as transit remains restricted through the Strait of Hormuz, keeping supply concerns alive. EIA data showed U.S. commercial crude stocks up by 4.4 million barrels last week at 428.8 million, bringing inventories in line with their five-year average for the time of year. The elimination of the longstanding crude deficit "would appear price-neutral if not for the continued sizable deficits in the product markets," Ritterbusch & Associates says in a note. "WTI can be pulled higher by a strong distillate market since key refiners beyond the East and West coasts that represent about 80% of U.S. capacity are still running virtually full-out." WTI settles up 1% at $85.83 a barrel, and Brent rises 0.7% to $91.62--both well off intraday highs.(anthony.harrup@wsj.com)

1457 ET - U.S. natural gas futures rise for a second consecutive session as late-summer weather forecasts add heat to the outlook. Strong national demand is expected the next 10 days with most of the western and southern two-thirds of the U.S. facing "hot to very hot" temperatures, including high-90s to mid-100s in Texas, NatGasWeather.com says in a note. "Cooler exceptions the next 10 days will be across portions of the Midwest and Northeast." Tomorrow's EIA storage report is expected to show the smallest weekly build of the season, trimming the inventory surplus over the five-year average. Analysts in a Wall Street Journal survey expect an injection of 18 Bcf. Nymex natural gas settles up 1.4% at $2.814/mmBtu.(anthony.harrup@wsj.com)

1155 ET - Oil futures add to earlier gains with the market seemingly taking little comfort from a third weekly build in U.S. commercial crude stocks that put inventories in line with their five-year average. The 4.4 million barrel rise in stocks to 428.8 million barrels follows last week's unexpectedly large 17.4 million barrel increase. "The supply shock is easing with production up and demand weakening a bit," says David Russell of TradeStation. "While the energy situation is tight and difficult, worst-case scenarios aren't playing out." WTI is up 1.9% at $86.54 a barrel and Brent is 1.5% higher at $92.37 a barrel. (anthony.harrup@wsj.com)

1139 ET - The boon of oil price volatility for Couche-Tard is still there, but it's easing as oil prices settle. Scotiabank analyst John Zamparo says that in the U.S., competitors Murphy USA and Yesway both beat on fuel margins in 2Q but guided for this to more moderate in the back-half of the year. Zamparo notes that consensus sits at a U.S. fuel margin of 50 cents a gallon compared with his updated estimate of 48 cents a gallon, down from a prior 50 cents. "The national average for the quarter was 42.6 cpg. We believe ongoing geopolitical tensions should keep fuel margins somewhat elevated," he says, but notes that the national average has moderated to 42 cents a gallon three weeks into the fiscal 2Q. (adriano.marchese@wsj.com)

1122 ET - Indirect effects of surging energy prices on eurozone core inflation have been close to zero so far, but they are likely to build in the second half of the year, Capital Economics' Jack Allen-Reynolds says in a note. If energy prices remain around their current levels, headline inflation will soon rise to about 3.5% in the next few months, he says, from 2.9% in July. Together with a likely increase in energy inflation in August, food inflation will probably rise too. Meanwhile, the rise in core goods inflation could have further to run, given that ICT-equipment inflation will keep rising on the back of strong global demand for artificial intelligence-related goods, he says. (edward.frankl@wsj.com)

1057 ET - The current low water levels of the River Rhine will hurt German manufacturing production in the third and fourth quarters if sustained, Pantheon Macroeconomics' Claus Vistesen says in a note. The gauge at the bottleneck of Kaub reached record lows in August, with vessels potentially forced to carry substantially less cargo. "A prolonged low water level in the Rhine is a negative supply shock to industrial logistics," Vistesen says. Recent data could point to a 6.6% fall in intermediate-goods production--a decent proxy for sensitivity to low water levels--pushing down industrial production by 2.5% over six months, all else being equal, he says. If the heatwave continues, third and fourth-quarter GDP forecasts could get downgrades of between 0.1 and 0.2 percentage points, he says. (edward.frankl@wsj.com)

1045 ET - President Trump's talk of reviving the Keystone XL pipeline through a possible trade deal with Canada may be a reference to South Bow's effort to help build a transborder pipeline called Prairie Connector. South Bow, spun off from Keystone's original proponent TC Energy, has said it will decide by mid-2027 to proceed with a 550,000-barrels-a-day pipeline between Alberta and Wyoming. Canadian economist David Watt, on his Not Just Canada substack, notes the Prairie Connector, as envisaged, would make use of pipe that was set to be part of the Keystone XL expansion. Analysts had reckoned that South Bow's plan might hinge on government-backed financing to account for political risk. Former President Biden revoked Keystone XL's permit in 2021. (paul.vieira@wsj.com; @paulvieira)

1017 ET - U.A.E. homebuilders are prioritising larger projects that are already well advanced in funding and completion as the property market slows, Fitch Ratings says. Residential transactions fell 19% on quarter in the second quarter, with new launches also much lower. Larger developers such as Emaar and Majid Al Futtaim are better positioned to pursue this strategy because they can launch large developments and release units in stages, Fitch says. Smaller developers could find it harder as land, construction and financing costs remain high. The ratings firm expects fewer headline launches, larger project sizes and longer delivery schedules if current trends persist. (farhan.rafid@wsj.com)

1003 ET - Germany should invest in expanding its transportation infrastructure in light of supply concerns over the low water levels in the River Rhine, Swiss business lobby Economiesuisse's chief economist Rudolf Minsch says. Companies are waiting for transport solutions from governments, with Swtizerland proceeding only slowly, he says. But the situation in particularly acute in Germany. "As in Basel, shallow-water sections in Germany should also be dredged, particularly in the German Kaub area," Minsch says, referring to the pinch point in the Rhine Valley in northwestern Germany. Firms are still waiting for expanded north-south rail capacity in Germany. "This expansion is constantly being delayed, much to the chagrin of the business community and consumers," he says. (edward.frankl@wsj.com)

1002 ET - Abu Dhabi leads most major Gulf stock markets lower, reversing five consecutive sessions of gains. Abu Dhabi's benchmark index falls 0.9%, Qatar's QE Index loses 0.8% and the Dubai Financial Market General Index declines 0.3%, while Saudi Arabia's Tadawul All Share Index edges 0.1% higher. Iran fired two ballistic missiles toward the Strait of Hormuz on Tuesday, triggering U.A.E. air defenses, while attacks on shipping in the waterway have intensified, with at least 14 vessels hit so far in August. The U.S. has refrained from another direct military response, and President Trump has said no talks with Tehran are currently under way. (farhan.rafid@wsj.com)

1000 ET - U.S. natural gas futures add to yesterday's gains with support from late-summer heat that should keep up power-sector demand. "Weather models remain to the warm side for 2/3 of the U.S.," Dennis Kissler of BOK Financial says in a note. The expectation that tomorrow's EIA storage report will show a below-average weekly injection "is kicking in some short-covering buyers in the early trade this morning," he adds. Nymex natural gas is up 3.4% at $2.87/mmBtu.