Brent crude oil spiked toward $92 per barrel Tuesday as the U.S.-Iran conflict entered its tenth day, with the Strait of Hormuz recording only 127 vessel transits for the week ending July 19—a nearly 50% drop from 248 transits the prior week. The price surge followed U.S. military strikes on Iranian infrastructure and retaliatory attacks on Persian Gulf energy facilities, prompting Indian Oil Corp. and Mangalore Refinery to suspend Iraqi crude loadings. The Strait of Hormuz, a critical chokepoint handling roughly one-fifth of global oil supply, has seen daily tanker traffic fall below the pre-conflict benchmark of 125 transits per day as commercial operators reroute through Iran's northern passage.
Brent Crude Reaches $91.63 Peak as WTI Climbs 2.3%
Brent crude oil surged toward $92 per barrel Tuesday, briefly touching a peak of $91.63 per barrel before easing to $91.26 as of 5 p.m. EST. The rally extended across energy markets, with U.S. benchmark West Texas Intermediate rising 2.3% to $84.38 per barrel. WTI has surged more than 20% since hostilities resumed.
Strait of Hormuz Transits Drop Nearly 50% to 127 Vessels
Maritime intelligence data reveals that overall weekly transits plunged nearly 50%, dropping from 248 vessels for the week ending July 12 to 127 for the week ending July 19. Daily tanker traffic remains well below the pre-conflict benchmark of 125 transits per day. The U.S. naval escort corridor has been virtually abandoned, with ship operators overwhelmingly rerouting traffic through Iran's northern passage. Direct strikes on tankers and commercial cargo ships have severely disrupted maritime trade in the strait.
U.S. warplanes and naval destroyers targeted key civilian infrastructure, including bridges and power generation facilities. Iranian forces retaliated against energy and civilian infrastructure across neighboring Persian Gulf states.
Goldman Sachs Forecasts Brent at $80 Baseline, $120 Worst Case
Goldman Sachs Group estimates that Persian Gulf crude shipments have collapsed to below 45% of pre-war levels. The bank's baseline forecast assumes eventual de-escalation that would bring Brent crude to average $80 per barrel in the fourth quarter. Commodities analysts warned in a research note that persistent navigation restrictions could send Brent past $120 per barrel in the fourth quarter and average $100 per barrel through next year. The bank emphasized that alternative overland pipelines and Red Sea bypass routes lack sufficient capacity to absorb the massive supply deficit.
Indian State Refiners Suspend Iraqi Crude Loadings
Indian state refiners, including Indian Oil and Mangalore Refinery and Petrochemicals, suspended crude loadings from Iraq. The suspensions follow escalating security risks that have fractured physical trade flows in the Persian Gulf region.
FAQ
What caused Brent crude oil to spike toward $92 per barrel?
Brent crude oil spiked toward $92 per barrel Tuesday as the U.S.-Iran conflict entered its tenth day. U.S. military strikes on Iranian infrastructure and retaliatory attacks on Persian Gulf energy facilities disrupted maritime trade through the Strait of Hormuz. Vessel transits through the strait dropped nearly 50% to 127 for the week ending July 19, down from 248 the prior week.
What is Goldman Sachs' forecast for Brent crude prices?
Goldman Sachs Group's baseline forecast assumes Brent crude will average $80 per barrel in the fourth quarter. However, commodities analysts warned that persistent navigation restrictions could send Brent past $120 per barrel in the fourth quarter and average $100 per barrel through next year. The bank estimates Persian Gulf crude shipments have collapsed to below 45% of pre-war levels.
Why did Indian Oil Corp. suspend Iraqi crude loadings?
Indian Oil Corp. and Mangalore Refinery and Petrochemicals suspended crude loadings from Iraq due to escalating security risks. Direct strikes on tankers and commercial cargo ships in the Strait of Hormuz have severely disrupted maritime trade, prompting Indian state refiners to halt operations.
