Brent Crude Climbs Past $90 as Hormuz Standoff Deepens

Prices Rally on Supply Anxiety

Benchmark crude contracts posted solid gains Monday as investors priced in prolonged disruption to Middle Eastern oil flows. Brent futures closed at $90.87 per barrel, up $2.35, while West Texas Intermediate added $2.10 to finish at $84.50.

The rally extended last week's five percent climb, driven by mounting evidence that normal tanker movements through the Strait of Hormuz remain severely curtailed. Ship-tracking data from Kpler recorded just five commodity vessels passing through the waterway Saturday, with zero on Sunday. The prior weekend saw 31 transits. Before hostilities began in late February, roughly one-fifth of global oil and liquefied natural gas volumes moved through the chokepoint.

Washington's position hardened over the weekend. President Donald Trump told Fox News that Iran must capitulate entirely, adding that the administration would not extend the existing memorandum of understanding. Energy Secretary Chris Wright said Iran cannot currently export oil and described the strategy as economic strangulation, though he added that global markets do not require Iranian barrels.

A senior Iranian official told Reuters that Tehran would escalate activity in the strait and potentially launch attacks if an interim peace framework is not fully implemented within weeks. Foreign Ministry spokesperson Esmaeil Baghaei said negotiations with Oman over strait management are ongoing but complicated by the number of actors involved and attempts by third parties to undermine progress.

Asian Buyers Adjust Procurement

Abu Dhabi National Oil Company sold at least 14 million barrels of spot crude to Asian refiners in its latest tender, according to trade sources Monday. Saudi Aramco has begun offering supply sourced from outside the Strait of Hormuz to select Asian customers, two people familiar with the arrangements said.

The shift reflects producer efforts to maintain market share while physical logistics remain constrained. Both Gulf producers have been targets of recent attacks; ADNOC-operated tankers were struck in the strait, and a Saudi Aramco refinery was hit last week.

Phil Flynn, senior analyst at Price Futures Group, said escalating rhetoric translates directly into higher prices. Bjarne Schieldrop at SEB Research noted that crude is trading near $90 as the market weighs two scenarios: deeper disruption that could push prices significantly higher, or a diplomatic breakthrough that reopens the strait and sends values sharply lower.

Frank Walbaum, market analyst at Naga.com, said consolidation around current levels is likely absent fresh catalysts. The combination of restricted shipping and stalled negotiations limits downside potential, he added.

US Strategic Reserve Hits Four-Decade Low

Crude inventories in the US Strategic Petroleum Reserve fell 5.3 million barrels last week to 293.4 million barrels, the lowest level since December 1982, Department of Energy data showed. The drawdowns are part of a 172-million-barrel release program agreed earlier this year.

Energy Secretary Wright said Monday he would meet with US refiners to discuss ways to increase fuel output and ease gasoline prices, which remain elevated despite the conflict. Domestic refiners are already operating at high utilization rates as strong product prices have lifted margins.

Over the weekend, Iranian Foreign Minister Abbas Araqchi said Tehran has not decided to resume talks with the US. Trump urged Americans to accept higher fuel costs during the conflict, signaling the administration's willingness to absorb economic pain in pursuit of strategic objectives.

The Bab el-Mandeb Strait, another critical oil transit route, remains open for now. Schieldrop said prices are unlikely to move substantially higher unless flow through Hormuz halts entirely or Bab el-Mandeb closes.

Asian refining centers, which rely heavily on Gulf crude, are watching supply availability closely. The spot premiums ADNOC secured in its tender reflect tightening availability and rising competition for barrels that can bypass the strait. Saudi efforts to redirect supply suggest Gulf producers are preparing for an extended period of logistical constraints, even as they maintain public optimism about a negotiated resolution.