WTI crude jumped 10% this week to trade above $91 after the United States and Iran exchanged their heaviest fire since July, reviving the war premium in oil. Vessel traffic through the Strait of Hormuz remains well below prewar levels even as Washington and independent trackers report conflicting figures on how much oil is actually crossing, while tightening U.S. inventories add further support.
October WTI crude futures traded at $91.80 Thursday night, up $8.36, or 10.02%, for the week so far. The contract had fallen as low as $84.11 early in the week before reaching $93.14, its strongest level since late July, after the U.S. and Iran exchanged their heaviest fire since July.
Fighting Widens Into Kuwait
Tuesday's U.S. strikes targeted Iranian radar, air-defense, communications and mine-laying positions along the southern coast, and Iran answered with attacks on U.S. positions around the region. Brent settled Wednesday at $95.63 and WTI at $91.01, the highest settlements for both contracts since July.
Thursday's session opened with profit-taking after President Trump said the renewed fighting would not last too long. The mood reversed after Kuwait's army said it was confronting Iranian missile and drone attacks, and Iranian state media said U.S. bases in Kuwait were the targets.
Israeli Defense Minister Israel Katz warned that Israel would cripple Iranian military and civilian infrastructure, including energy facilities, if Tehran attacked Israel. WTI pushed to $93.14 and Brent reached $97.48 before both contracts backed off their highs.
By Friday, prices had eased back. Brent November futures fell 0.4% to $95.15 a barrel, while WTI slipped 0.6% to $90.77 a barrel, though both benchmarks stayed on track for sharp weekly gains near six-week highs. Iran also struck U.S. and allied positions across the Gulf region, including Kuwait, Bahrain and Jordan.
Hormuz Traffic Still Falls Short
Six commodity vessels transited the Strait of Hormuz on Wednesday, down from 11 the day before and below the recent 10-day average of about 13. Washington reported far higher flows: officials pointed to roughly 17 million barrels moving through the waterway Monday, while an escorted group of about 40 vessels carrying roughly 18 million barrels passed through Tuesday.
Independent trackers see a smaller flow. Kpler recorded 11 visible commodity-vessel crossings Tuesday, while Lloyd's List Intelligence recorded roughly 12 transits a day from August 26 through September 1. Kpler's reconstructed Hormuz clearance, which tracks barrels rather than ship counts, has averaged 8.6 million barrels per day since mid-June.
Inventories Tighten as OPEC+ Meets
U.S. supply data added further support. The EIA reported a 4.5 million-barrel draw for the week ended August 28, leaving commercial crude stocks at 424.5 million barrels, while refineries ran at 98% of capacity, the highest rate since 2018. The Strategic Petroleum Reserve fell to 286.6 million barrels.
OPEC+ is expected to keep its October output policy unchanged at Sunday's meeting.
Sources: Oilprice.com, Oilprice.com, Investing.com
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