Hormuz Tensions Fuel Oil Price Rally as Global Shortfall Looms
Crude oil prices held steady near six-session highs on August 12 as tensions over the Strait of Hormuz remained unresolved. The International Energy Agency predicted a shortfall of 1.8 million barrels per day in global oil supplies this quarter, more than double its previous projection.
The agency warned that the 2026 deficit would likely be the widest in five years. Despite the ongoing conflict between the US and Iran, crude prices were on track for a weekly gain, extending months of volatile trading.
US President Donald Trump stated that the US had 'total control' over the strait, but talks between Washington and Tehran appeared deadlocked, with both sides hardening their positions. The deadlock has tightened oil markets further, exacerbated by ongoing fighting in West Asia and Ukraine.