On a Friday in August, crude oil and gasoline prices climbed sharply as the Strait of Hormuz, one of the world's narrowest and most vital passages for energy, stayed largely closed. The stalled search for a shipping arrangement between Iran and Oman, combined with Houthi strikes on a Saudi refinery and Ukrainian blows against Russian fuel infrastructure, reminds us how fragile the chain that carries warmth and motion into ordinary lives has become. Each closed lane and burning refinery is a small reminder that the global economy rests on routes that a few quarrels can suddenly narrow.
Crude Jumps 3.5% as Hormuz Stalemate and Houthi Strikes Tighten Global Oil Supply
Five vessels a day, down from fourteen after the June memorandum
Mark
Why did prices jump nearly 4% on one day?
Mimi
Two things landed together: no Iran-Oman deal on Hormuz, and a Houthi strike claim on Saudi Arabia's Jazan refinery.
Mark
How bad is the strait's traffic?
Mimi
Energy Aspects says about five vessels a day, against 14 a day after the June memorandum.
Luke
Worth noting that's one firm's average, and the Jazan attack is a Houthi claim in this reporting, not an independently confirmed one.
Mark
Araghchi said a deal was very close. Doesn't that help?
Mimi
He attached conditions: end the US blockade, withdraw forces, lift sanctions, release assets, pay compensation, stop attacks on allied groups.
Luke
Which is a long list. "Very close" is his characterization, and nothing here shows the US accepting any of it. Trump called it "semi-negotiating."
Mark
What about Russia?
Mimi
Ukraine hit its energy infrastructure at least 30 times in July. Processing is at a 24-year low, and fuel exports are banned.
Luke
Yet Russian crude exports are at multi-year highs, which cuts against price gains. The effects pull in opposite directions.
Mark
And OPEC+?
Mimi
It finished restoring its 1.65 million bpd cut, but delivering the increases may be hard amid the attacks.
Luke
"May be hard" is an expectation, not a measured shortfall. We don't yet know how much will actually reach the market.
Il Polso
- Only about five vessels a day are slipping through the Strait of Hormuz, down sharply from fourteen after the June memorandum, and the supply squeeze is tightening by the day.
- A UAE tanker was struck by a missile while crossing the strait, and Houthi militants claimed an attack on Saudi Arabia's Jazan refinery, pushing the threat of a wider Middle East flare-up closer.
- Iran says a shipping route deal with Oman is very close, but it attaches demands to reopening that include lifting sanctions, ending the US blockade, and compensation for war damage.
- Ukraine's strikes on Russian refineries have pushed Russian processing to its lowest level in 24 years, and Moscow has banned most fuel exports.
- Prices are settling higher as traders watch whether Iran-Oman talks move forward and whether OPEC+ can deliver its promised barrels amid renewed attacks.
On a Friday in August, crude oil and gasoline prices climbed sharply as the Strait of Hormuz, one of the world's narrowest and most vital passages for energy, stayed largely closed. The stalled search for a shipping arrangement between Iran and Oman, combined with Houthi strikes on a Saudi refinery and Ukrainian blows against Russian fuel infrastructure, reminds us how fragile the chain that carries warmth and motion into ordinary lives has become. Each closed lane and burning refinery is a small reminder that the global economy rests on routes that a few quarrels can suddenly narrow.
On Friday, September crude rose more than three percent and gasoline reached a one-week high, as the Strait of Hormuz remained largely shut. The immediate obstacle is the absence of a deal between Iran and Oman to reopen the waterway. Iran's foreign minister says an agreement on a shipping route is close, but Tehran has linked reopening to a long list of conditions, including an end to the US blockade of Iranian shipping, sanctions relief, release of frozen assets, and compensation for damage from American attacks.
President Trump has signaled he is content to let economic pressure build rather than order new strikes, calling the talks only "semi-negotiating" while the blockade deepens Iran's financial strain. Meanwhile the strait is far from calm. Only about five vessels a day are passing, compared with fourteen after the June memorandum. A UAE tanker was hit by a missile on Saturday, and on Sunday Houthi militants claimed an attack on Saudi Arabia's Jazan refinery, vowing to intensify attacks on Saudi tankers in the northern Red Sea.
Russia adds its own strain. Ukraine has struck Russian refineries, tankers, and pipelines dozens of times in a single month, and processing has fallen to its lowest point in roughly two decades. Fuel rationing has spread across most Russian regions, and Moscow has banned nearly all exports of gasoline, jet fuel, and diesel. Some counterweights remain. Chinese crude stocks are still plentiful, and Russian crude exports have stayed strong, perhaps because damaged refineries are sending crude abroad instead.
OPEC has finished restoring its 2023 cut and plans to hold output steady for the rest of the year, though delivering those barrels amid renewed attacks may prove difficult. The next signals to watch are whether Iran and Oman advance their shipping talks and whether OPEC+ can keep its promises.
On Friday, September West Texas Intermediate crude rose $2.76, or 3.53%, and September RBOB gasoline gained 12.03 cents, or 4.03%, lifting gasoline to a one-week high. The move came as the Strait of Hormuz stayed largely shut and as a Houthi attack on a Saudi refinery added to the strain on fuel supplies.
The immediate driver was the lack of a deal between Iran and Oman to reopen the strait. Iranian Foreign Minister Abbas Araghchi said an agreement with Oman to set up a shipping route was very close. But he tied reopening to a long list of conditions: the US must end its blockade of Iranian shipping, pull its forces back from around Iran, lift sanctions, release frozen assets, and compensate Iran for damage from US attacks. Iran also demanded a permanent end to attacks on groups it backs in Lebanon, Iraq, Yemen and Gaza.
President Trump signaled on Sunday that he is willing to let economic pressure on Iran build rather than order more military strikes. He said the US was only "semi-negotiating" with Iran over Hormuz, and that the blockade was deepening Iran's financial troubles.
The traffic numbers show the cost. Energy Aspects said an average of only five vessels a day are passing through the strait, well below the 14 a day recorded after the US and Iran reached a memorandum of understanding in June. Security remains fragile: a UAE tanker was targeted by a missile on Saturday while crossing the strait. On Sunday, Houthi militants in Yemen claimed an attack on Saudi Arabia's Jazan refinery, and said they would step up attacks on Saudi oil tankers in the northern Red Sea to stop them from transiting.
Russia is another source of pressure. Ukraine hit Russian refineries, tankers and major pipeline infrastructure at least 30 times in July, the second-highest monthly count since the war began in 2022. EA Analytics expects Russian crude-processing to average 3.51 million barrels per day in July, the lowest in 24 years. By the end of June, about 90% of Russian regions had imposed some form of fuel rationing or reported supply problems. Several major refineries have shut, and the government has banned almost all exports of gasoline, jet fuel and diesel. Russia is the world's second-largest diesel exporter after the US, according to Vortexa.
Some factors pull the other way. China's crude inventories remain abundant, down only 54 million barrels since early May to roughly 1.2 billion, per Kpler, which could curb Chinese buying. Russian crude exports are also strong: Bloomberg data show the four-week average stayed above 4 million barrels per day through July 26, after reaching 4.13 million through June 28, the highest since the 2022 invasion. Crippled refineries may be pushing more crude abroad.
OPEC delegates agreed on August 2 to a final increase of 188,000 barrels per day for September, completing the restoration of the 1.65 million barrel-per-day cut made in 2023. The group plans to hold output steady for the rest of the year. Delivering those barrels may be hard amid renewed US-Iran attacks. OPEC's July output rose 1.16 million barrels per day to 19.44 million.
In the US, last Wednesday's EIA report showed crude inventories as of July 31 were 6.2% below the five-year seasonal average, gasoline stocks were also 6.2% below, and distillates were 11.7% below. Output was 13.804 million barrels per day, just under the record 13.862 million. Baker Hughes counted 454 active oil rigs in the week ended August 7, up three and a 14-month high. Vortexa said oil on stationary tankers fell 0.7% to 119.28 million barrels.
The next signals to watch are whether the Iran-Oman shipping talks move forward and whether OPEC+ can deliver its promised barrels.
Citazioni salienti
An agreement with Oman on a shipping route through the strait is very close, but reopening requires the US to end its blockade and more.— Abbas Araghchi, Iranian Foreign Minister
The US is only "semi-negotiating" with Iran on the Strait of Hormuz.— President Trump
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