Oil News: Can WTI and Brent Extend Gains as the Hormuz Blockade Threat Grows?
Key Points:
- U.S. threats of an indefinite Iran blockade keep Hormuz supply risk in WTI and Brent as tanker traffic remains depressed.
- The EIA’s 17.4-million-barrel crude build gave sellers a powerful argument after WTI and Brent rallied this week.
- OPEC cut its 2026 demand-growth forecast again, while the IEA expects global oil consumption to decline next year.
The Strait of Hormuz problem just got a timeline and it is indefinite. The United States threatened a naval blockade of Iran that has no end date attached to it, two Abu Dhabi National Oil Company vessels were attacked while transiting the strait Thursday, and ceasefire talks have stalled with both sides raising demands instead of lowering them. Last week crude sold off because traders thought a framework could reopen the waterway. This week proved that trade was wrong. Friday’s news is telling the market to stop pricing a near-term resolution and start pricing a conflict that Washington is preparing to extend. The rally has legs underneath it but the ground is not as solid as it was Monday. A 17.4-million-barrel U.S. crude build, a fourth straight OPEC demand downgrade and the IEA calling for outright demand destruction in 2026 are all sitting on the other side of the trade.