WTI Crude Oil Prices Fall Amid Eased Persian Gulf Tensions
Crude oil prices fell on Thursday after tensions in the Persian Gulf eased slightly. September WTI crude oil (CLU26) closed down -2.02 (-2.43%), and September RBOB gasoline (RBU26) closed down -0.0257 (-0.81%).
The market breathed a sigh of relief with no overnight reports of new military attacks by the US or Iran in the Persian Gulf. The Trump administration's pivot to using naval blockades as economic pressure on Iran also reduced concerns about the region.
However, traffic through the Strait of Hormuz remains slow, tightening global crude supplies and boosting oil prices. Only an average of five vessels are transiting through the Strait daily, down from 14 ships a day seen after the US and Iran reached a memorandum of understanding in June, according to Energy Aspects.
The International Energy Agency (IEA) also reported that the global oil supply deficit will worsen, even as oil demand takes a hit from the war and high prices. Global oil inventories are expected to fall in Q3 at twice the previously estimated rate due to ongoing disruptions from the US-Iran war.