Oil Holds Firm as Hormuz Reopening Talks Stall; IEA Warns Supply Deficit Is Widening
Forecast Trend Report by Period
Oil remained firm as the market awaited progress in negotiations to reopen the Strait of Hormuz.
Bloomberg reported on August 12 that West Texas Intermediate was trading below $83 a barrel. WTI edged lower after climbing about 11% over the past five sessions, while Brent settled near $88 a barrel the previous day.
President Donald Trump said the US had "complete control" over the waterway. But negotiations to reopen the strait have shown no meaningful progress.
In a report released that day, the International Energy Agency said a prolonged US-Iran conflict would widen the global oil market's supply deficit to 1.8 million barrels a day in the third quarter of this year. That is more than double its previous forecast.
The IEA also projected that the annual supply shortfall in 2026 would be the largest in the past five years.
Market participants say the wars in the Middle East and between Russia and Ukraine are simultaneously squeezing supplies of crude and petroleum products and adding to inflation pressure.
Separately, AAA said US gasoline and diesel prices are at record highs for this time of year. With summer travel demand rising, elevated oil prices are increasing the burden on consumers.
