Crude Prices Fall as Persian Gulf Tensions Ease Slightly

Crude oil prices experienced a slight decline on Thursday as tensions between the US and Iran eased. The September WTI crude oil (CLU26) closed down -2.02 (-2.43%), while September RBOB gasoline (RBU26) dropped by -0.0257 (-0.81%). No new military attacks were reported in the Persian Gulf overnight, and concerns about the Middle East were reduced by news indicating the Trump administration was focusing economic pressure on Iran through a naval blockade.

Despite Plug Power beating estimates and raising its 2026 outlook, the situation in the Persian Gulf remains tense. Iran maintains control over the Strait of Hormuz, rejecting President Trump's claims of ownership. Traffic through the Strait remains slow, with only an average of five vessels transiting daily, down from 14 ships a day after a June memorandum of understanding between the US and Iran.

The International Energy Agency (IEA) reported that global oil supply deficits would worsen in Q3 due to ongoing disruptions from the US-Iran conflict. Meanwhile, Ukraine's drone attacks on Russian oil infrastructure have intensified, causing a decline in Russian crude processing rates to 3.51 million bpd, the lowest in 24 years. As a result, Russia may increase crude exports, adding to global oil supplies and exerting bearish pressure on crude prices.

OPEC+ approved an increase in crude production by +188,000 bpd for September, aiming to hold output steady for the rest of the year. However, the production rise may face challenges due to renewed US-Iran military attacks in the region. US crude oil inventories fell by 17.4 million bbl, while gasoline inventories decreased by -968,000 barrels in the week ending August 7.