Oil Prices Plummet as West Asian Supply Uncertainty Hits Demand Outlook

Oil prices dropped by 1% on Thursday as markets weighed continued uncertainty over West Asian supplies against a weak demand outlook.

The price of Brent crude fell 0.16% to $88.87 a barrel, while WTI crude dropped 0.3% to $83.02 a barrel. Both contracts had earlier fallen more than 1% each in the session.

The decline was triggered by conflicting signals from the U.S. and Iran on the status of the Strait of Hormuz, a key waterway that supplied around 20% of the world's oil consumption prior to the Iran war.

Yemen's Iran-backed Houthis added to concerns over supply disruptions in West Asia after they began attacking ships in the Red Sea and the Bab el-Mandeb Strait, another key oil shipping route. The Organization of Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA) both trimmed their 2026 oil demand forecasts, citing cooling economic growth, restricted fuel supplies, and rising prices stemming from the U.S.-Israeli war on Iran.