Brent oil holds near $102 as Strait of Hormuz closure drags on

Brent crude oil prices have remained surprisingly stable near $102 per barrel, despite the Strait of Hormuz being closed for nearly seven months. This stability contrasts with earlier fears of a severe price shock, suggesting that the market may be misinterpreting the situation. On October 4, 2026, Mohammad Baqer Qalibaf, Iran’s parliament speaker, reinforced this uncertainty by stating that the strait would remain closed until seven specific demands are met.

The Strait of Hormuz typically handles about one-fifth of global oil and LNG flows, making its closure a significant geopolitical and economic event. The Islamabad Memorandum of Understanding (MoU), signed in June 2026, aimed to reopen the strait but ultimately failed. The key question now is whether Iran’s demands are a negotiating tactic or a hard line that could lead to a lasting supply disruption.

Qalibaf described Iran’s stance as ‘completely clear and firm,’ with demands including lifting US naval blockades, oil sanctions, and unfreezing Iranian assets. Analysts are divided on whether these demands are maximalist or negotiable. The closure of the strait is being used as leverage in a broader political package, not just a technical issue.

Despite the closure, oil prices have not spiked as much as expected, partly due to bypass pipelines that have offset some of the supply loss. Brent crude rose to about $120 before settling near $102, with analysts noting that the market is pricing in a managed disruption rather than a complete breakdown. However, this calm could be fragile, with three possible scenarios: a negotiated partial reopening, a prolonged stalemate, or further escalation.