Oil prices slip as markets weigh US-Iran supply risks

Crude oil prices pulled back for a second consecutive session on Thursday as markets reassessed the supply implications of renewed US-Iran hostilities, with benchmark prices retreating from this week's highs even as the standoff in the Strait of Hormuz continued to disrupt global energy flows.

Prices Ease After Monday's Surge

The retreat follows a dramatic surge on Monday, when Brent crude futures jumped 9.6% to settle at $83.30 a barrel and West Texas Intermediate rose 9.4% to $78.14, after President Donald Trump announced the reinstatement of the US naval blockade on Iranian shipping in the Strait of Hormuz. Brent had climbed as high as $86.99 on Monday morning before easing.fortune+1

By Tuesday, Brent had slipped to around $85.92, and on Wednesday WTI crude fell to approximately $79.55, according to TradingEconomics data. The pullback suggests the market is beginning to differentiate between a full closure of the strait and what one analyst has called a "new normal" of intermittent conflict.fortune+1

Asian Refiners Scramble for US Crude

The standoff has prompted a flurry of purchases from Asian refiners seeking alternatives to Middle Eastern supply. At least 11 million barrels of US crude were sold to Asian buyers late on Tuesday, with cargoes for July and August loading bought at premiums of $11–$12 a barrel above the Dubai benchmark, according to Bloomberg and Reuters. The buyers are trying to offset what has been a virtual standstill in observable tanker traffic through the Strait of Hormuz.energy.economictimes.indiatimes+1

The International Energy Agency warned in its July report that world oil demand is on track to decline for the first time since 2020, with the conflict driving a 1 million barrel-per-day drop in global consumption this year. China alone has seen demand fall by 1.5 million barrels per day, a 9% decline.iea+1

Broader Markets Under Pressure

Commodity and crypto markets reflected the uncertain mood. Gold traded near $4,067 per ounce on Tuesday, slightly below its prior session according to CNBC data, having already fallen about 28% from its January 2026 record amid hawkish Federal Reserve expectations. Bitcoin ↘ 0.29% hovered around $64,750 on Tuesday after briefly topping $65,000 for the first time in three weeks, though it remains roughly 46% below its October 2025 all-time high.goldsilver+3

The IEA cautioned that renewed exchanges of fire in the Gulf "highlight the risks of not reaching a lasting peace agreement, which is a must for the normalisation in oil markets".iea