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strikeAug 18, 2026

Oil climbs as fading peace deal hopes raise supply risks

Summary

Oil prices rose today as prospects receded for a deal to end the Middle East war, with Iran saying it would adopt a more offensive stance and the United States ruling out extension of a ceasefire deal, heightening worries about energy supply. Iran will shift to a "fully offensive"military postureas efforts have stalled towards a permanent end to the war, a senior Iranian official told Reuters yesterday, as Washington ruled out extending their temporary ceasefire pact. Brent crude futures climbed 62 cents, or 0.7%, to $91.49 a barrel this morning, after rising yesterday to their highest since July 30. US West Texas Intermediate crude futures were up 75 cents at $85.25 a barrel, but off an earlier session gain of more than 1% to reach $85.37, their highest since July 31. Outward progress on peace talks and resumption of oil tanker traffic through the strategic Strait of Hormuz has halted, threatening to extend the conflict the United States and Israel launched with attacks on Iran on February 28. "Oil has jumped to start the week as US-Iran relations look increasingly shaky," said Tim Waterer, chief market analyst at KCM. "A deal to reopen the Strait of Hormuz still does not appear to be in sight, and shipping numbers remain at a trickle." A projectile struck a vessel transiting out of the Strait of Hormuz on Tuesday in the latest of the attacks that have kept crossings to the single digits, despite a slight rise from the weekend, tracking data showed. Yemen's Houthis launched missiles in an attackon vessels they described as a Saudi military ship and four escorts in the Red Sea, their military spokesperson, Yahya Saree, said on the Telegram messaging app. "The lack of any kind of deal will have an impact on oil price expectations further out in 4Q and even in 2027," said DBS Bank's head of energy research Suvro Sarkar. While the deal-related uncertainty lasts, he expected oil prices to range within $80 and $100 a barrel in the near term. Iran has separately been negotiating with Oman an agreement on managing the Strait of Hormuz and says they are close to a deal. But Trump responded to those talks with a threat to bomb the Gulf state, a longstanding US security partner. US crude oil stockpiles were expected to have fallen last week alongside product inventories, a preliminary Reuters poll showed yesterday.

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    Oil prices rose today as prospects receded for a deal to end the Middle East war, with Iran saying it would adopt a more offensive stance and the United States ruling out extension of a ceasefire deal, heightening worries about energy supply. Iran will shift to a "fully offensive

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TEHRAN: Iran's armed forces on Wednesday (Aug 19) warned Gulf countries against assisting the United States military, saying it would be tantamount to joining American military operations. "We wish to warn that any assistance or facilitation provided to the aggressor US military amounts to participation in the US military operation," armed forces chief of staff Ali Abdollahi said, according to Iran's Mehr news agency.

War between Iran and the US broke out on Feb 28 after US-Israeli attacks on the Islamic Republic, which retaliated with missile and drone strikes including on US bases across the region. "It seems unlikely that such a large number of military aircraft, particularly refuelling aircraft, could be present at regional bases without knowledge of host countries," said Abdollahi.

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FTSE 100 Live: Stocks to fall as oil jumps after Trump claims Strait of Hormuz Welcome back to the City AM liveblog. Oil prices are surging higher for the fourth consecutive session after Donald Trump declared the Strait of Hormuz as US territory. Brent crude – the international benchmark for oil prices – was climbing towards $92 as there was little indication the narrow waterway was to be reopened, keeping pressure on supply.

It comes after Trump shared a crude map of the Middle East with a large blue circle over Hormuz on Truth Social as he declared the vital shipping route as “NEW US territory”. “The Naval Blockade remains in full force and effect”, the President said.

“The Hormuz Strait is open and operating. All water mines have been removed or detonated”. Concerns around shipping through the strait has remained high despite Trump’s claim that the waterway is open and mines have been cleared. Limited traffic has continued to pass through the strategic route while Iranian forces have intensified hostilities.

Eight attacks on vessels transiting Hormuz, including ships linked to the UAE and Saudi Arabia, have been reported so far this month. In the US, crude inventories have fallen by 328,000 barrels over last week, following an over 9m barrel increase in the previous week.

Trump confirmed earlier this week that there are “no talks or conversations going on, or scheduled” with Iran. Meanwhile his US Special Envoy Jared Kushner, who is also the President’s son-in-law, said Iran is ”not showing any interest” in a deal proposed by the Trump administration.

We’ll be bringing you all the latest analysis and updates.

Location: Strait of Hormuz