NEW YORK / RankWire.AI / – Global oil markets are experiencing significant volatility as geopolitical tensions and supply disruptions influence prices. After reaching a peak, Brent crude surpassed the $90 mark on July 29 amid concerns over tightening supplies and renewed Middle East conflicts. Brent closed at $90.74, reflecting a gain of $6.65, or 7.9%, for the trading session. Meanwhile, West Texas Intermediate increased by $5.20, or 6.6%, ending at $84.46. These jumps marked the strongest daily gains for both benchmarks in several weeks. Oil prices also extended their rally from July, with both contracts rising more than 20% over the period.
Escalating military activity around key production and shipping hubs heightened market concerns. The U.S. and Saudi forces targeted Iran-backed groups in Iraq following drone assaults on Saudi oil facilities. Iran reported attacks on vessels near the Strait of Hormuz and on U.S. military bases in Jordan. During the same timeframe, explosions damaged a natural gas loading site in Egypt. Maritime security firm Ambrey reported damage to a U.S.-owned floating storage tanker at the Egyptian facility.
These hostilities have disrupted critical shipping lanes used by global energy suppliers. Limited commercial vessel movement persisted through parts of the Gulf and the Red Sea. The Strait of Hormuz, which handles a significant portion of oil exports from Persian Gulf producers, and the Bab el-Mandeb Strait, linking Red Sea shipping routes with Asian and European markets, faced delays. Such disruptions impacted cargo schedules and heightened pressure on the supply chain. Traders kept a close eye on damages near energy infrastructure and transportation networks.
U.S. crude inventories decline sharply
Recent data from the Energy Information Administration reinforced the upward momentum in crude prices observed on July 29. The report revealed a reduction of 7.2 million barrels in U.S. commercial oil stocks. Stocks decreased to 404.5 million barrels, the lowest level recorded since 2018, excluding crude stored in the Strategic Petroleum Reserve. This significant weekly decline in domestic supplies coincided with market concerns over transportation interruptions, military activities, and damage at regional energy sites.
On August 3, however, oil prices dropped sharply after the U.S. paused another planned strike against Iran. President Donald Trump also announced efforts toward an agreement concerning Iran’s nuclear program and the Strait of Hormuz. Brent fell by $4.49, or 5.1%, to $83.44 in early trading, while WTI declined by $4.90, or 5.8%, to $79.77. This decline erased much of the July 29 gains within just three trading sessions.
OPEC+ Moves to Increase Production in September
In response to declining prices, OPEC+ approved an additional output increase for September, raising its target by approximately 188,000 barrels per day. The decision marked the reversal of 1.65 million barrels per day in voluntary cuts introduced earlier in 2023. Participating nations include Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman. The group agreed to continue monthly reviews of market conditions and production compliance, with their next assessment scheduled for September 6.
Despite the pullback in August, both Brent and WTI prices remained above their average levels in June. Brent crude averaged around $85 a barrel in June, which is $22 below May’s levels and $32 beneath the April 2026 peak. The energy outlook for July projected an average Brent price of $82 a barrel for 2026. The move above $90 on July 29 was driven by declining U.S. inventories, restricted shipping routes, and active conflicts near key oil and gas infrastructure.