Brent crude climbed back toward $90 a barrel after U.S.-Iran talks over the Strait of Hormuz broke down again. Shipping through the strait has thinned sharply, and a second front of risk in the Red Sea is adding to the pressure on supply.
Brent crude rose to $88.90 a barrel on August 11, gaining around 5% over the past two days. The move reverses course from early August, when prices were falling on hopes of a U.S.-Iran deal and a gradual return of shipping through the strait.
That optimism has faded. Renewed disagreements between Washington and Tehran have raised the risk of a prolonged standoff, and the market is once again pricing in the chance that full tanker traffic through Hormuz stays disrupted for longer.
Hormuz traffic thins further
New U.S. demands on Iran have stalled the negotiations, and the strain shows in the shipping data. Only six vessels passed through the strait on Monday, compared with an average of around eleven over the previous ten days. Oil exports through the route fell to approximately 3 million barrels per day, down from 4.4 million barrels a week earlier.
Risk is also building on a second route. Houthi attacks continue to threaten alternative shipping through Bab el-Mandeb, and disruption on two major routes at once is pushing up transport costs and raising concern over the stability of global oil supply.
$90 becomes the level to watch
The $90 mark has become an important psychological threshold for the market. A sustained break above it could strengthen expectations of further gains, particularly if the Hormuz talks stay stalled or new supply disruptions emerge. Higher oil prices also carry risk beyond the commodity market, since rising energy costs could add to inflationary pressure and shape expectations for the Federal Reserve's rate policy.
According to FreshForex analysts, the base case for Brent remains bullish: as long as the Hormuz talks show no progress and supply-disruption risk persists, prices are likely to stay supported, and continued geopolitical tension could push Brent above $90 a barrel.
Source: MQL5
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