Oil Falls on Hopes of Easing Middle East Tensions, With WTI Near $82
Summary
- West Texas Intermediate (WTI) traded near $82 a barrel, leaving it down about 6% for the week.
- Concerns over supply disruptions eased somewhat after U.S. economic sanctions on Iran did not immediately include tougher measures against countries doing business with Tehran.
- Oil is still up more than 40% this year as the Middle East conflict, now in its sixth month, has disrupted energy supplies from the Persian Gulf.
Forecast Trend Report by Period
Oil fell after a volatile session as signs of diplomatic progress around the Strait of Hormuz offset rising tensions between Russia and Ukraine.
Bloomberg reported on Aug. 26 that West Texas Intermediate traded near $82 a barrel, down about 6% for the week. Brent crude settled below $88 a barrel.
Oil rose earlier after reports that Russian President Vladimir Putin planned to intensify the offensive against Ukraine. Those gains later evaporated after Iranian military authorities said they had reached an agreement on revenue sharing through Oman and the Strait of Hormuz.
Recent declines in crude have been driven in part by hopes for progress in negotiations over the Strait of Hormuz. Concerns about supply disruptions also eased after U.S. economic sanctions on Iran announced this week did not immediately include tougher penalties on countries doing business with Tehran.
Expectations are also growing that oil shipments from the Persian Gulf could gradually increase. President Donald Trump said on Aug. 25 that about 10 million barrels of oil passed through the Strait of Hormuz in a single day.
Still, Iran has repeatedly said the navigation agreement does not mean the strait will be fully reopened immediately. Oil remains up more than 40% this year as the six-month conflict in the Middle East has disrupted energy supplies from the Persian Gulf.
Suehyeon Lee
shlee@bloomingbit.ioI'm reporter Suehyeon Lee, your Web3 Moderator.