Brent crude climbed above $91 a barrel Tuesday for a third straight session of gains as tanker traffic through the Strait of Hormuz collapsed to zero over the weekend and a US-Iran truce expired without renewal. The rally is running without fresh speculative buying behind it, and a depleted US Strategic Petroleum Reserve has removed the mechanism Washington once used to cap such spikes.
The benchmark traded $90.97 a barrel Tuesday, up 0.11%, after climbing above $91 during the session. September West Texas Intermediate rose 63 cents, or 0.78%, to $84.39, with intraday prints reaching $85.18. Monday delivered the bulk of the move, when WTI rose 3.09% to $84.95 as traders priced the expiration of the 60-day US-Iran memorandum of understanding signed in June.
Brent is up 1.96% over the past month and 38.27% over twelve months, while WTI has gained 2.99% on the month and 35.49% on the year. Money managers have reduced bullish positioning on both benchmarks over the past two weeks, so the rally is running without a build in speculative length behind it.
Hormuz Transits Collapse to Zero
Only five commodity vessels transited the Strait of Hormuz on Saturday, and zero transited on Sunday, compared with 31 during the previous weekend. Two Abu Dhabi National Oil Company vessels were attacked late Thursday, an episode that removed the assumption operators could still route through the waterway untargeted. Private trackers estimate current flows out of the strait at up to 5 million barrels per day, against roughly 9 to 10 million barrels per day for the entire Middle East region.
Trump Rejects Extension, Threatens Oman
President Trump said Monday he is not interested in extending the interim peace deal with Iran, and the memorandum expired without replacement. He said he intends to inflict further economic pain on Tehran through new sanctions and repeated his position on declaring the Strait of Hormuz US territory. He threatened to bomb Oman if it interferes with US plans for the waterway. Trump also urged Americans to accept somewhat higher gasoline prices while the conflict continues.
A Depleted Reserve Removes the Ceiling
The US Strategic Petroleum Reserve stands at its lowest level since 1982, removing the buffer Washington used to cap prior price spikes through coordinated releases. Domestic output offers little offset: the EIA expects US production to rise just 200,000 barrels per day in 2026. Energy Secretary Chris Wright said Monday that Middle East oil exports have rebounded to 15 million barrels per day, a figure well above the 9 to 10 million barrels per day private trackers estimate for the region.
EIA Sees Disruption Persisting Into 2027
The Energy Information Administration's Short-Term Energy Outlook, published August 11, forecasts Brent to average around $85 a barrel in the third quarter of 2026 and to fall to $69 in 2027 as most regional production returns to pre-conflict levels. It expects ongoing Middle East disruptions of about 0.6 million barrels per day to continue through the end of 2027. Brent's current $90.97 sits $5.97 above the EIA's third-quarter forecast, a gap the agency's own numbers suggest reflects the risk premium added since the forecast was completed on August 6 — before the Abu Dhabi tanker attacks and the transit collapse to zero.
Source: Commodities Analysis & Opinion
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