Brent and WTI crude extended a multi-day rally on Wednesday after attacks on two ships in the Strait of Hormuz and the Bab el-Mandeb Strait reinforced worries about disruptions to Middle East supplies, while talks to end the Iran war stalled. The International Energy Agency warned that global oil stockpiles are depleting fast, adding urgency to reopening Hormuz.
Oil prices rose in volatile trade on Wednesday, extending gains after attacks on two ships reinforced worries about disruptions to Middle East supplies and as talks to end the Iran war hit an impasse. Brent futures climbed 35 cents, or 0.4%, to $89.26 a barrel, heading for a sixth straight day of gains. WTI crude rose 57 cents, or 0.7%, to $83.77, on course for a fifth daily gain.
Ship attacks squeeze Hormuz traffic
The United States and Yemen's Iran-aligned Houthis reported separate attacks on shipping in the Strait of Hormuz and the Bab el-Mandeb Strait on Tuesday, two routes that carry crucial Middle Eastern oil and gas alongside the Suez Canal. As a result, vessel transits through Hormuz fell to a one-week low of eight on Tuesday, down from the 125 to 140 ships that passed through the waterway daily before the war.
Iran talks hit an impasse
Meanwhile, a senior Iranian source told Reuters there were no discussions between Iran and the United States to extend their ceasefire, since Tehran views the deal as having no start date and therefore nothing left to extend. Prices resumed climbing on that news even after U.S. crude inventories rose by about 9.1 million barrels last week, a build that Haitong Futures said far exceeded expectations.
Depleting stockpiles raise the stakes
As a result, the IEA said observed global stocks fell below 7.9 billion barrels for the first time since April 2025, warning that "previously available inventory buffers are rapidly depleting." The agency now expects global oil supply to fall by 4.3 million barrels per day in 2026, to 102 million barrels per day, as growth from the Americas only partly offsets losses in the Middle East and Russia. Oxford Economics, for its part, now expects average oil prices near $85 a barrel for the rest of this year, before easing back toward $65 a barrel by the end of 2027 as crude oil supply gradually normalizes.
Sources: Reuters, The Guardian
Trading involves risk.
Risk Disclaimer
