Oil News: Sanctions Crack War Premium as Hormuz Supply Risk Holds the Floor
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Key Points:
- Iran sanctions triggered a sharp crude oil selloff because Washington gave no enforcement dates or named targets.
- WTI and Brent dropped more than 3%, but Hormuz traffic near shutdown keeps the physical supply risk alive.
- The U.S. Strategic Petroleum Reserve fell to its lowest level since 1982 as releases cover Middle East shortages.
Sanctions Cracked the War Premium but Supply Risk Held the Floor
Washington’s Iran sanctions package hit the oil market Tuesday and the selloff was immediate. Operation Economic Outcast came with tough language and zero enforcement dates, and traders who had been positioned for an aggressive crackdown pulled the war premium out of both contracts. The Strait of Hormuz is still running at near-shutdown volumes with strategic reserves sitting at levels not seen in four decades. The minor trends on both WTI and Brent turned down on the session.