Brent Falls to Around $87 as Strait of Hormuz Disruptions Become Largest in Oil Market History

The International Energy Agency described the disruptions associated with the Strait of Hormuz, which affected more than 14 million barrels per day of supplies, as the largest in the history of the oil market. As military operations quieted down in early August amid talks between Iran and the Sultanate of Oman, Brent crude pulled back to the high-$80s range after peaking at $105 in July, while US crude trades near $81.

The agency considers that global oil demand will fall in 2026 due to demand destruction resulting from high prices, meaning that the shock has shifted from a supply shock to a demand shock as well. The trajectory of prices remains hostage to ongoing talks, as any collapse in negotiations or a full reopening of the strait could completely alter the landscape.