Oil Market Rally Falters as Hormuz and Bab el-Mandeb Disruptions Persist

The oil market has seen a significant rally in recent weeks, with Brent crude rising by 45% from its July 2 low of $70.14 to $102 on July 23.

This surge has attracted late money into the market, leaving it vulnerable when the war slows down.

The current disruption involves physical movement through two critical chokepoints: Hormuz and Bab el-Mandeb.

Fewer than 10 commodity vessels per day moved through Hormuz over the weekend, against a normal flow of around 20 million barrels per day of crude, condensate, and products.

The US has paused attacks to give diplomacy time but warned it could take strong military action if talks fail.