U.S.-Iran talks and shipping changes shift oil prices as Hormuz recovery remains gradual

Crude Inventories Have Fallen To "Precariously Low" Levels U.S. crude inventories fell sharply last week as refineries ramped up production to capitalize on higher fuel prices following renewed conflict with Iran, according to Financial Times. Commercial crude stockpiles declined by 7.2 million barrels, while the Strategic Petroleum Reserve (SPR) dropped another 3.8 million barrels. Refineries operated at 97% of capacity nationwide, with some Midwest facilities running at full capacity as exports to Asia and Europe increased. FT writes that the drawdown comes as renewed fighting between the U.S. and Iran continues to disrupt oil shipments through the Strait of Hormuz, forcing the U.S. to help offset reduced Middle Eastern supplies. Analysts warn that America is increasingly carrying the burden of stabilizing global oil markets. "US crude inventories, both commercial and the SPR, have drawn down by nearly 20 per cent since early April. The US accounts for about 70 per cent of global onshore crude inventory draws over the past four months," said Matt Smith of Kpler. "It has carried the burden of trying to keep oil prices in check over this period via SPR releases and higher exports, but stockpiles are rapidly depleting and this pace of draws cannot persist ad infinitum." The SPR has now fallen to 307.7 million barrels, its lowest level in more than 40 years. While still above its estimated operational minimum of 180 million to 200 million barrels, analysts warn that continued depletion leaves the U.S. increasingly exposed to future supply shocks. Commodity Context founder Rory Johnston described current crude and gasoline inventories as "precariously low." Tyler Durden Sat, 08/01/2026 - 08:45

Hormuz Ship Traffic Edges Higher, But Kpler Warns Gulf Crude Exports Remain Impaired Shipping traffic through the Strait of Hormuz slightly increased as US-Iran negotiations remained ongoing in an effort to restore peace after the memorandum of understanding collapsed amid two weeks of tit-for-tat strikes, according to Pakistan's Foreign Ministry spokesperson Tahir Andrabi, who provided no further details. Still, the security situation in the Gulf deteriorated overnight after the US launched a new wave of strikes on Iran following attacks on US forces in Jordan. Additionally, reports emerged that a US-owned LNG vessel was struck at an Egyptian port. Bloomberg cited Kpler data showing that fourteen commodity vessels transited the Hormuz chokepoint in both directions on Wednesday, up from single digits the previous week. Kpler wrote on X: Hormuz shipping bottleneck endures A four-day pause in US strikes on Iran has done little to restore Middle East Gulf crude exports. Confirmed clearance remained close to recent lows, while Gulf loading activity fell by more than half for the first time in six weeks. The crude backlog has shifted between the Gulf and the Gulf of Oman rather than disappeared. Persistent maritime security risks, war risk insurance costs and Iranian interdiction now appear to be the main barriers. Offshore ship to ship transfers are helping manage inventories, but not expanding export capacity. For energy markets, physical shipping data remain a clearer measure of supply conditions than geopolitical headlines. Hormuz shipping bottleneck endures A four day pause in US strikes on Iran has done little to restore Middle East Gulf crude exports. Confirmed clearance remained close to recent lows, while Gulf loading activity fell by more than half for the first time in six weeks. The crude… pic.twitter.com/e9aZ5cfGCP — Kpler (@Kpler) July 30, 2026 Qatar's Al Areesh exited the Persian Gulf carrying the country's first LNG shipment in three weeks, while a supertanker was provisionally booked at nearly $500,000 a day to load Gulf crude for China. US Energy Secretary Chris Wright said about 6.5 million barrels of oil a day moved through the strait over the past week with US support. "We are using the United States military to escort out oil and gas out of the Strait of Hormuz,” Wright told Bloomberg Radio, saying about 6.5 million barrels of oil a day exited the Gulf via the strait over the past week. "We are restoring supplies of global oil and refined products to the world out of that region." Maritime Chokepoint Developments: Strait of Hormuz A Norwegian-flagged products tanker appears to be preparing to exit Two Iran-linked Suezmaxes, Chloe and Kariz, sailed into the strait and are now idling off Iran's Bandar Abbas Very large crude carrier Jamaica Prosperity was provisionally fixed by the shipping unit of a Chinese charterer to pick up a Persian Gulf cargo on Aug. 3 at 465 Worldscale points, or nearly $500,000 per day Southern Red Sea Twenty-one commodity vessels crossed the Bab el-Mandeb strait in either direction on Wednesday, compared to 38 a day earlier: Kpler Only Russian crude left via the chokepoint, totaling about 3.5 million barrels, although some vessels may have transited with transponders off South Korean-controlled VLCC V Glory seen approaching Gulf of Aden recently before going dark; Saudi-flagged Samha seen doing so on Thursday On Wednesday, some ships were provisionally booked to load from Yanbu in August, with the option of exiting via Bab el- Mandeb to reach South Korea Northern Red Sea Two LNG carriers were struck late Wednesday at Egypt's Damietta port near the mouth of the Suez Canal; no one has claimed responsibility yet Japanese-flagged VLCC Takamatsu Maru is the latest to divert to Egypt's Sidi Kerir on the Mediterranean coast as a destination from US previously; ship is currently southeast of Africa Bidbid and VL Prosperity have arrived at and loading from Sidi Kerir, with previously reported destinations in Asia Three VLCCs — Olympic Luck, DHT Gazelle and DHT Mustang — that departed Yanbu are currently idling off Sidi Kerir with no clear destination Tyler Durden Thu, 07/30/2026 - 09:30

WTI Holds Spike After Big Crude Draw, SPR Drain Continues As Cushing Stocks Stuck At 'Tank Bottoms' Oil prices are jumping higher after the U.S. military intercepted Iranian ballistic missiles aimed at American forces in Jordan. Shortly after the surprise attack, the U.S. and Saudi Arabia launched strikes in Iraq against Iran-backed groups that the Islamic Revolutionary Guard Corps previously directed to attack American troops and Saudi energy infrastructure. As Barron's Patrick O'Donnell reports, the escalation in hostilities hit market hopes that the vital Strait of Hormuz waterway would reopen. More than a quarter of the world's crude usually passes through the shipping channel and tanker traffic remains essentially halted. "These developments throw cold water on the idea of a swift de-escalation in the Persian Gulf," analysts at ING said. "Clearly, with Saudi oil infrastructure increasingly targeted, the risk of more prolonged supply disruptions grows." President Trump this morning threatened to hit Iran “hard,” while the US and Saudi Arabia retaliated against militia and weapons sites in Iraq linked to Tehran. Overnight, we saw API report a sizable crude draw but product builds (as the crack spread has eased somewhat)... API Crude -3.3mm Cushing -300k Gasoline +900k Distillates +400k DOE Crude -7.17mm Cushing -771k Gasoline +7k Distillates +1.06mm The official DoE data shows a much larger crude drawdown than expected, and another drop in the stocks at the crucial Cushing Hub. Products saw small builds... The Trump administration continues to drain the Strategic Petroleum Reserve Cushing stocks remain near 'tank bottoms'... US crude production remains just off record highs... WTI is holding back above $84.50... Finally, as Bloomberg's Michael Ball notes, the selloff earlier in the week was driven more by liquidation than normalization. Observable Hormuz traffic remains impaired, insurers and shipowners are cautious, not only through the Strait but now in the Red Sea. Trend-following funds cut Brent length sharply, while falling aggregate open interest shows positions were closed into heavy volume earlier in the week before the latest escalation. The curve and options markets tell a similar story. Brent and WTI backwardation narrowed as longer-dated spreads fell to their weakest since mid-July, reflecting less urgency around prompt supply. Brent implied volatility dropped this week before firming again overnight. However, call skew retained an upside bias, something be justified by oil prices on the rise again. The tighter market is in products. The European gasoil crack has surged above $70 a barrel as refiners run near capacity, with diesel and jet supplies constrained by outages, shipping risks and reduced Russian exports. Crude stocks can rebuild quickly; refining capacity cannot. Headline prices remain sensitive to kinetic and diplomatic developments, while product scarcity and impaired shipping mean the bottom of a developing trading range will be higher than the recent lows suggest for now. Tyler Durden Wed, 07/29/2026 - 10:36

Gulf Bond Boom: Record Borrowing Fuels Race To Future-Proof Against Hormuz Shutdown Gulf monarchies are hitting international debt markets at a record-shattering pace, Bloomberg figures show, amid a conflict-driven rush to harden domestic infrastructure and forge alternative supply corridors that bypass the vulnerable and effectively closed Strait of Hormuz. Added to this, just this month, Red Sea passage has become another problematic area, as the Houthis have targeted several Saudi vessels with missiles and drones. Regional heavyweights led by the UAE and Saudi Arabia are seeking massive funding for new or expanded deep-water ports along the Red Sea and Gulf of Oman, backed by desert networks and crude oil pipeline bypasses. This modernization will take years, but is being hastened by the urgency of war. As Bloomberg reports Tuesday, "Borrowers from the United Arab Emirates are tapping global bond markets at a record pace as the Middle East conflict rages, with sales up a third so far in 2026 versus year-ago levels." Image via Global Capital  The underlying totals underscore the unprecedented size of the paper issuance: "Sovereigns and companies from the UAE, a federation of seven emirates, have sold a combined $30.3 billion of dollar- or euro-denominated bonds this year through July 28, according to data compiled by Bloomberg. That’s about $3.7 billion above the previous record for this period hit six years ago." This is consistent with our analysis from April, just a little two months into Trump's Iran "excursion" - as he was calling it at the time, which saw the world's largest bond manager, PIMCO (Pacific Investment Management Co), step in amid the emerging Gulf scramble to find buyers for its bonds. More broadly among regional Gulf Cooperation Council (GCC) states, bond sales have exploded to a record $112 billion so far this year, according to Bloomberg data, with government debt desks actively probing international banks for additional leverage. When the US-Israeli war on Iran originally flared and reached a peak in March and April, regional banks froze fundraising and market participants retreated into defensive capital preservation mode to gauge the economic fallout. But in the wake of the April 8 ceasefire - which was eventually extended before collapsing by mid-summer, UAE lenders drove the charge to tap global capital markets, with UAE-based institutions claiming five of the eight major capital market transactions completed in Q2. Chart: Ed Clowes/Semafor, Source: Bloomberg According to UAE's English-language daily Khaleej Times: Emirates NBD became the first Gulf lender to tap international capital markets after the outbreak of the conflict, issuing $750 million in additional Tier 1 (AT1) capital on May 1. The offering attracted strong investor demand, with subscriptions reaching three times the amount offered despite ongoing market volatility, according to the bank. First Abu Dhabi Bank (FAB) emerged as the region’s most active debt issuer during the quarter. In June, the lender completed two senior debt transactions under its $20 billion euro medium-term note programme, including a €750 million ($858.3 million) three-year green bond and a separate $300 million issuance. The quarter also featured a notable equity transaction from Sharjah Islamic Bank, which raised Dh2.59 billion ($704.8 million) through a rights issue. The bank said the offering was more than 3.2 times oversubscribed, with the Government of Sharjah fully subscribing to its allocation while remaining shares attracted subscriptions exceeding 4.5 times the amount available. Gulf capitals are looking to ensure in a long-term way that even if regional maritime flashpoints flare up or traditional choke points get closed down, the vital flow of energy exports and trade keeps moving along uninterrupted. This is one of the bigger 'lessons' of this ongoing costly Washington adventurism, given it has been largely Gulf infrastructure that's had to absorb the bulk of Iran's retaliation pain. Tyler Durden Wed, 07/29/2026 - 07:45

Massive Relax By Benjamin Picton, Senior Macro Strategist at Rabobank Oil futures are being offered this morning after President Trump on Friday declined to continue strikes on Iran. The ‘pause’ was extended over the weekend and reciprocated by the Iranians, marking the first ‘cease’ of the ceasefire in almost a fortnight. According to Axios, Donald Trump’s advisors had provided the President with attack plans for the day but CENTCOM commander Admiral Brad Cooper reportedly advised against further strikes, arguing that Iran’s ability to disrupt shipping in the Strait of Hormuz had already been substantially degraded and that the aerial campaign had reached the limits of its effectiveness. In a similar vein, the New York Times published a report over the weekend revealing that General Dan Caine, Chairman of the Joint Chiefs of Staff, had cautioned the President that further escalation was possible but that it would dangerously deplete CENTCOM’s stock of interceptor missiles. This would expose the nineteen-odd US bases across the Middle East to even greater damage than they have already sustained, to say nothing of the infrastructure of GCC allies and the strain on the US’s defence priorities in the Pacific and elsewhere. President Trump denied the reports, telling the Wall Street Journal “we have far more [interceptors] than we need.” In a further hopeful sign, an Omani team of negotiators has reportedly met with counterparts in Tehran to discuss arrangements to re-open the Strait of Hormuz. Iranian foreign ministry spokesman Baqaei said that the talks had been “useful” and that progress had been made, but that there was no change in the status of the strait at this point. It also remains to be seen whether any agreement reached between Iran and Oman would be accepted by the United States. Nevertheless, President Trump’s threats of ‘massive attack’ late last week that saw Brent crude surge above $100/bbl, higher bond yields, and equities under pressure has now given way to a massive relax, with Brent below $92/bbl, equity futures pointing higher and sovereign yields lower across the board. Though it hardly bears noting, at this point it would behove us to caution that the war is not over and that we certainly are not out of the woods from either an energy security or financial markets perspective.  To illustrate this point, the Wall Street Journal carried a story over the weekend regarding the escalating tit-for-tat between the Saudis and the Houthis that threatens to conflagrate into all-out war. Houthi attacks on Saudi Aramco infrastructure at the critical port of Yanbu (the Red Sea release valve for Saudi oil exports) over the weekend followed a declaration last week that Saudi Arabia’s Red Sea ports would be subject to a blockade that further threatens to starve energy-poor Asia of vital crude oil flows. For now, China is continuing to play the constructive role of balancing item by holding its crude imports well below the usual levels. Similarly, Israel was reportedly bracing for escalation over the weekend with the Jerusalem Post noting that public bomb shelters had been re-opened in major cities. Israeli Prime Minister Netanyahu said that the war would continue until the Iranian regime fell or gave up its nuclear ambitions, again highlighting the likelihood that hostilities will remain ongoing until one is forced to concede on the nuclear issue – and likely concede its regional influence in the process. A further coalescing of an anti-Iranian bloc is also becoming more evident. Al Jazeera reports that Syrian President Al-Sharaa is seeking a security agreement with Israel that will apparently include several other countries and likely include provisions to stem to flow of weapons to Hezbollah in Lebanon. This as Israeli government sources indicate that Israel has dramatically stepped-up its engagement with the GCC since the outbreak of the war, which has perhaps already yielded fruit through the UAE’s decision to leave OPEC and OPEC+. Détente between Gulf states and Israel holds out the prospect of less fragile supply chains in the future, where oil flows West rather than East and Iran loses its leverage over the global economy, but that potential future is riddled with ‘ifs’, and solves none of our near-term problems. Elsewhere, Iranian Foreign Minister Araghchi accused Ukraine of doing Israel’s bidding after the former struck an Iranian vessel in the Caspian Sea, killing at least one crew member. Ukrainian President Zelensky defended the action by stating that Kyiv was targeting vessels involved in military cargo shipments alongside Russian warships, again raising the prospect of two conflicts merging into one. While geopolitical considerations will doubtless continue to set the tone this week, the Fed, Bank of England and Bank of Japan will all be meeting to set their respective policy rates. None are expected to raise their rate targets this time around but the inflationary impacts of war, and considerations over how persistent those shocks may prove to be, will surely loom large in their deliberations. This week will also bring Q2 GDP readings for the United States and the Eurozone, along with Q2 PCE for the former and July CPI for the latter. Tyler Durden Mon, 07/27/2026 - 10:20

Iran, Oman Hold Hormuz Talks As US Pauses Airstrikes For Second Day The US military paused its air campaign against Iran for a second consecutive night after nearly two weeks of tit-for-tat strikes. US strikes were aimed at degrading Tehran's one-way attack drone and missile capabilities around the Strait of Hormuz, while Iran hit US bases in the region. The pause offers the clearest signal yet that a diplomatic off-ramp may be emerging, with Iranian and Omani officials reporting progress in talks to reopen the critical waterway. Iranian Foreign Ministry spokesman Esmail Baghaei said in a Telegram post that he met with the Omani deputy foreign minister and held talks on Friday and Saturday about restoring safe transit for commercial vessels through the Strait of Hormuz. Baghaei said the officials exchanged views on principles and operational mechanisms for managing safe maritime navigation through the strait. "The talks were constructive, and some progress was made," he added, noting that technical and political consultations remain ongoing. The Omani delegation left Tehran on Saturday evening. Camera zooms in to reveal LINE of ships all 'stopped in Strait of Hormuz' — Fars News pic.twitter.com/F8wDPdBDBT — RTVisual (@RT_Visual_on_X) July 26, 2026 The talks coincided with the US military's two-day pause in strikes and came as Brent crude futures surged into triple-digit territory and the national average for regular gasoline jumped above the politically sensitive $4-a-gallon mark. JPMorgan's head of Global Commodities Research and Strategy, Natasha Kaneva, told clients last week that Brent prices at this level could increase pressure on Washington to reopen diplomatic channels. Meanwhile, Iranian Army spokesman Mohammad Akraminia appeared on state television on Sunday and warned the US that any further strikes would widen the conflict. "I believe that if the Americans once again fall for the Zionists' deception, or move in line with them, and insist on continuing the war, particularly through air strikes, geographically this will expand further," Akraminia warned. Akraminia said the conflict has already expanded to the Bab al-Mandab Strait on the southern Red Sea, referencing the recent Houthi attacks on tankers. "The scope of our operations now encompasses the entire region, from US bases in Jordan to the countries along the Persian Gulf," he said. Earlier, United Kingdom Maritime Trade Operations reported an incident in the southern Red Sea after a "tanker witnessed a splash from an unknown projectile in proximity to the vessel." Details are scant at the moment. Next week, Israeli Prime Minister Benjamin Netanyahu will travel to Washington, DC to meet with President Trump at the White House on Tuesday. Latest overnight headlines, courtesy of Bloomberg: US-Iran Strike Pause The US paused its nearly two-week run of nightly strikes on Iran for a second consecutive night as of Sunday morning. According to the Telegraph, Trump paused plans to escalate the war after being warned the US is running low on missiles; the pause also allows time for negotiations with Iran. Iran's army spokesman said Iran has also paused its retaliatory operations in response to the US halt. Still, he warned that if the US carries out ground operations, American vulnerability would increase. Netanyahu said he will discuss the Iran situation with Trump. Diplomacy & Negotiations Trump said Friday the US was "locked and loaded" for major new strikes but had not yet decided whether to proceed while talks with Iran were ongoing; he said Iran would "love to make a deal" but it's not time yet. Trump leaned toward diplomacy on Friday, referencing negotiations with Iranian officials six times during a 38-minute Oval Office appearance, while leaving open the possibility of military escalation. Iranian and Omani deputy foreign ministers held talks in Tehran on Friday and Saturday on managing safe maritime navigation through the Strait of Hormuz, with some progress reported. China urged Iran and the US to return to the ceasefire agreement, with Foreign Minister Wang Yi expressing deep concern over renewed escalation in the Middle East. Regional Spillover Iran-backed Houthis claimed to have fired missiles and drones at Saudi Aramco facilities in Jizan and Yanbu on Saturday; Saudi authorities briefly issued emergency warnings before saying the danger had passed, with no immediate confirmation from the Saudi government or Aramco. A UK Navy report on Sunday noted a projectile fell near a tanker in the southern Red Sea; the vessel and crew were reported safe. An LPG tanker with 28 Indian crew members was attacked in Iranian territorial waters on Friday; India's embassy confirmed the crew are safe. Background & Context The US had gradually expanded the scope of its strikes over two weeks, hitting bridges and infrastructure deeper inside Iran, after a brief ceasefire in June collapsed over a battle for control of the Strait of Hormuz. Billionaire investor Ray Dalio warned that the war's outcome hinges on the Strait of Hormuz, calling a decisive clash imminent. Previous US-Iran Wrap Trump Pursues Diplomatic Off-Ramp As Omani Delegation Arrives In Tehran: Report Regional Risks War Zones Converging? Zelensky Says Ukraine Hit Ship "Transporting Military Cargo" From Iran Energy Market Gas Prices Nearing Levels That Could Push Trump Towards Iran Talks, Says JPM Commodities Expert Goldman Warns Brent Could Top $120 If Gulf Chokepoint Crisis Deepens RBC Commodities Chief Warns "War Entering Dangerous Phase" As Chokepoint Chaos Risks Oil Above 2008 Peak "It's Getting Worse": HSBC Warns Commodities Face Squeeze As Chokepoint Chaos Spreads Rewiring Gulf Energy Supply Chains Seven Pipeline Projects That Could Break Iran's Grip On Hormuz Chokepoint Gulf States Considering Network Of New Pipelines To Bypass Strait Of Hormuz Great Rewiring: US Supports Iraq-Syria Oil Pipeline To Erode Tehran's Hormuz Leverage Dubai's New East Coast Port Signals The Beginning Of End For Iran's Hormuz Leverage   Tyler Durden Sun, 07/26/2026 - 08:10