Brent crude futures held at $88.72 a barrel in early Asian trade on Monday, up 20 cents from Friday’s close, while West Texas Intermediate slipped 5 cents to $82.35. The benchmarks are coming off weekly gains of more than 5 percent after attacks on tankers operated by Abu Dhabi National Oil Company and a Saudi Aramco refinery in the Strait of Hormuz. With the war between Washington and Tehran now in its sixth month and crude up more than 40 percent this year, the market is pricing a supply risk that diplomacy has so far failed to dent.
Tanker traffic defies the headlines
Despite the weekend’s escalation, Lebanon’s deadliest day of clashes in months as Israel struck Hezbollah targets and several more vessels came under fire in the strait, Middle Eastern producers are still moving crude at volumes that exceed the market’s expectation of roughly 4 million barrels a day. The flow data, tracked by people familiar with the shipments, suggests the physical market has not yet priced in a full closure, even as insurance costs and routing delays accumulate.
Sanctions pipeline stays open
Treasury Secretary Scott Bessent signaled that additional sanctions on Iran could be announced as early as this week, while President Trump has said he is not concerned whether the conflict concludes before the November midterms. The administration’s stated goal remains severe economic pressure on Tehran, a stance that keeps the sanction threat live regardless of battlefield developments. Brent’s 40 percent year-to-date rally reflects that policy commitment as much as any single attack.
Oman-Iran channel excludes Washington
Iran and Oman appear to be nearing an arrangement on managing the Strait of Hormuz, a waterway that previously carried about one-fifth of global daily oil and liquefied natural gas supplies. The United States is not party to those talks and is unlikely to endorse any framework that does not guarantee unrestricted passage. A parallel diplomatic track that excludes the primary security guarantor adds a layer of uncertainty to any de-escalation narrative.
What to watch this week
The next directional move will likely come from the sanction details Bessent previewed and whether the Oman-Iran understanding produces any observable change in transit patterns. Until then, the market is left with a physical surplus that contradicts the geopolitical premium, a gap that has persisted for six months and shows no sign of closing on its own.