Oil News: WTI and Brent Slide as Hormuz Deal Hopes Outrun Oil Flows
Key Points:
- Brent gave back nearly half its $70-to-$102 rally in two sessions as Oman’s Hormuz plan fueled profit-taking.
- WTI and Brent fell to July 17 lows, but low Hormuz traffic leaves the oil supply disruption unresolved.
- Saudi Aramco shut its 400,000-barrel-per-day Jazan refinery, widening the risk beyond tanker traffic.
Oil is selling off again Tuesday on reports that Oman has presented a plan backed by Gulf states that would let Iran collect voluntary fees for use of the Strait of Hormuz under a joint regional arrangement. Trump said the United States is having good talks with Iran. The market heard that and kept booking profits after last week’s run above $100 in Brent. That is the second straight session of selling on diplomatic headlines and both sessions have the same problem: the barrels that were missing last week are still missing. Hormuz traffic remains a fraction of normal. The Red Sea is still taking fire. Saudi Aramco shut its 400,000 barrel-per-day Jazan refinery after an attack. The market is pricing a deal that does not exist yet while the supply disruption that drove the rally has not improved.