Oil Set for Weekly Gain Amid Stalemate Over Iran Conflict Resolution

Oil is poised for a weekly increase as the vital Strait of Hormuz remains effectively closed, with attempts to resolve the war in a standstill and disruptions that have shaken global markets expected to persist.

Brent crude has risen to approximately $107 a barrel, with futures climbing around 6% this week. West Texas Intermediate is trading above $102. President Donald Trump has made contradictory statements regarding Hormuz, initially telling Fox News that the US doesn’t require the waterway to be open, then later stating, “we want the straits open” while alongside Chinese leader Xi Jinping in Beijing.

The ongoing war has reduced global oil inventories at an unprecedented rate, and the market will remain “severely undersupplied” until October, even if hostilities cease next month, as noted by the International Energy Agency this week. Data released by the US on Tuesday highlighted how the conflict is reigniting inflation, increasing domestic pressure on Trump ahead of the midterm elections in November.

Trump and Xi are set to meet again following their Thursday summit, where discussions included the Iran war and the Strait of Hormuz, according to a White House official. The US leader remarked that Xi is interested in purchasing more American oil, though China’s official summary did not mention energy as a topic of discussion, instead noting that the Middle East was addressed.

A ceasefire has been in effect since early April, despite several flare-ups, but Washington and Tehran seem to be making little headway in reconciling their differences. Trump recently stated that the truce is on “massive life support,” while criticizing the Iranian response to his proposal to conclude the war.

“I believe the path of least resistance in the near term for prices leans more bullish as we continue to see crude oil and fuel inventories decline,” said Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc. “Given the significant gap in current agreements, an escalation of tensions is more likely than not.”

A US naval blockade of Iran’s ports remains active, and the waters in the region continue to pose risks for mariners. A commercial vessel was seized by unauthorized personnel near the entrance to the strait on Thursday and was taken into Iranian waters.

Prices:
Brent for July settlement increased 1.3% to $107.05 a barrel at 1:10 p.m. in Singapore. WTI for June delivery was 1.4% higher at $102.63 a barrel.

Since the conflict began, only a small number of tankers have departed the Persian Gulf, severely diminishing essential energy supplies, including natural gas, to global customers. Trading house Vitol Group is offering Iraqi crude — outside Hormuz — to buyers, indicating that some shipments may have successfully exited the gulf.

Crude and fuel flows through the Strait of Hormuz dropped by nearly 6 million barrels per day in the first quarter after hostilities commenced in late February, according to the Energy Information Administration this week.

© 2026 Bloomberg