Crude Oil Holds in High Range as Hormuz Flows Persist Despite Fresh Attacks

Oil prices remain under pressure but firmly elevated, as tankers continue to move crude through the Strait of Hormuz under heightened military protection and growing regional security risks. Brent is trading close to EUR 80/bbl and WTI near EUR 75/bbl after a sharp pullback, yet both benchmarks still show gains of more than 40% since early 2026 amid the Iran war and costly shipping disruptions. Crude futures are on track for a weekly gain, supported by an increasingly tight fundamental backdrop. Despite missile and drone attacks on vessels and refineries in the wider region, around 9 million bpd is still transiting Hormuz, partly under escort and often with AIS transponders switched off. The International Energy Agency projects the global supply deficit will deepen this quarter to the largest shortfall in five years, as sanctions, war risk premiums and refinery outages compound already low US commercial inventories.

Prices

Brent traded near USD 87/bbl (≈EUR 80/bbl) and WTI around USD 81/bbl (≈EUR 75/bbl) after a 2.2% decline in the previous session. The pullback reflects some relief that loaded tankers keep exiting the Persian Gulf despite repeated strikes and threats, tempering fears of an immediate supply collapse.

Even so, oil has risen by more than 40% year-to-date, driven by the Iran war, disrupted trade routes and ballooning freight and insurance costs. Market consensus sees crude holding in a broad USD 80–90/bbl (≈EUR 74–84/bbl) range unless a major military escalation or diplomatic breakthrough sharply alters supply expectations.

Supply & Demand

Around 9 million bpd of crude is estimated to be crossing Hormuz as the US expands naval escorts, signalling that volumes remain substantial but fragile. Many tankers are reportedly sailing “dark” with tracking systems off to reduce the risk of targeted attacks, increasing operational hazards and complicating risk assessment for traders and insurers.

The International Energy Agency anticipates a deeper global supply deficit this quarter, with the shortfall likely to reach its widest annual level in five years. This tightening comes as US commercial inventories hover near an eight‑year low, while additional Middle Eastern barrels are being redirected toward the US to partially offset domestic stock draws.

On the demand side, firm refined‑product cracks, especially diesel spreads that have surged to record levels after the latest Jazan refinery attack, indicate strong product demand and constrained upgrading capacity, which in turn supports higher crude runs and underpins feedstock demand.

Geopolitics & Infrastructure Risks

Negotiations between Iran and Oman over fully reopening the Strait of Hormuz remain stalled, with both Washington and Tehran hardening their positions. The US continues to threaten further economic measures while maintaining a naval blockade of Iranian ports, even as it escorts commercial vessels through the choke point.

Risk has spread beyond Hormuz. Iran‑backed Houthi forces have claimed new drone attacks on Saudi Arabia’s Jazan refinery, adding to refinery outages and reinforcing uncertainty along the Red Sea corridor and Bab el‑Mandeb. These incidents further complicate shipping logistics, elevate insurance premia and tighten regional product balances.

Despite these threats, a significant fleet of tankers continues to move crude out of the Gulf, often via covert or dark transits, highlighting both resilience and vulnerability in the current flow pattern. The risk of a sudden disruption—through a successful large‑scale strike on key infrastructure or a breakdown in talks over Hormuz governance—remains the primary upside catalyst for prices.

Fundamentals

The core balance is clearly tightening: the IEA’s projected supply deficit coincides with multi‑year‑low US inventories, ongoing OPEC+ discipline and conflict‑related supply risk in the Middle East. Elevated war‑risk premiums for hull and cargo insurance and higher freight rates on the Gulf–Asia and Gulf–Europe routes are effectively raising landed crude costs, particularly for more distant buyers.

At the same time, the partial rerouting of Middle Eastern crude to the US is offering some relief to domestic refiners but does not fully offset the structural deficit. Cautious trading behavior—shorter contract tenors, preference for prompt cargoes and higher collateral requirements—also reflects a market that is tight in physical terms but wary of headline‑driven volatility.

Short-Term Outlook & Trading View

Baseline expectations point to Brent and WTI consolidating within the USD 80–90/bbl (≈EUR 74–84/bbl) range in the near term. Absent a major escalation, ongoing escorted flows through Hormuz and incremental crude arriving in the US should prevent an immediate price spike, while the deepening supply deficit and low inventories limit downside room.

Trading outlook (next 1–3 weeks):

• Producers: Consider maintaining or modestly increasing hedges in the upper half of the USD 80–90/bbl range to lock in elevated margins while geopolitical risk is priced in.
• Refiners: Secure prompt crude and middle‑distillate cover; high diesel cracks and regional refinery outages argue for continued strength in product margins.
• Consumers: Use any dips toward the low USD 80s (≈EUR mid‑70s/bbl) to layer in hedges; structural tightness and war risk make a sustained move much lower unlikely without a diplomatic breakthrough.
• Speculators: Favor a buy‑on‑dips bias with tight stops, acknowledging that both sudden ceasefire headlines and surprise attacks can trigger sharp, short‑lived price swings.

3-Day Directional Outlook (in EUR)