Renewed US-Iran military tensions and Houthi strikes on tankers in the Red Sea and Bab el-Mandeb Strait reversed prior crude oil oversupply narratives, pushing Brent crude above $100 per barrel, according to Oilprice. Both the Strait of Hormuz and the Red Sea — two of the world's most critical oil export chokepoints — faced simultaneous disruption risk. The escalation followed an attack on a US military base in Jordan, after which President Trump threatened to strike Iran directly, with reports indicating strikes had already hit Iranian port infrastructure including the port of Sirik.
Brent crude reached above $100/barrel before a partial reversal. WTI crude jumped above $84 and Brent approached $90 on a single session that saw oil surge approximately 7%. A subsequent US pause in military strikes drove Brent down more than 9% to below $88/barrel on 27 July. A subsequent API crude inventory draw then lifted Brent back to $87.95 (+4.59%) and WTI to $82.89 (+4.58%).
Brent crude and WTI are the global benchmark contracts directly pricing the disrupted export flows through the Strait of Hormuz and Bab el-Mandeb. Saudi Arabia's Jazan refinery shut following Houthi attacks, and QatarEnergy extended force majeure through September, tightening physical supply in the Atlantic and Asian markets. Tanker traffic through the Strait of Hormuz remained halted during peak escalation, directly affecting shipping routes for Gulf crude.
The US Federal Reserve held interest rates steady against this backdrop, while the S&P 500 closed down 1.52% and semiconductor stocks fell 5.33% on the same session that captured compounding macro pressures. The elevated oil price level raised concerns about additional inflation pressure feeding into the Fed's rate calculus.
Sources: Oilprice, Bloomberg Markets, Guardian Business, investinglive.com, BBC Business, OilPrice, Cnbc TOP, CoinTelegraph, Marketwatch TOP, Fortune, CNBC, Bloomberg